Companies like Google and Apple are funding enough new US renewable energy to power Iceland

Stock SectorApril 12, 20186min10
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Corporate America’s support for clean energy is gathering steam and expanding beyond big tech pioneers like Apple and Google.

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Companies signed deals that support the development of 2.8 gigawatts of new renewable power in the United States last year, according to a report from the Rocky Mountain Institute released Thursday. That’s roughly equivalent to the capacity of all power plants in Iceland — coincidentally, a country that generates nearly all of its electric power from renewable sources.

The total makes 2017 the second best year for U.S. renewable power purchases by corporations. It also marks the acceleration of a trend that has seen 9 gigawatts of new clean power brought online in the United States since 2013.

“It’s just the past five years where the momentum has started to build,” said Kevin Haley, a manager at the Rocky Mountain Institute’s Business Renewables Center, which helps corporations adopt clean power.

More than 50 companies across several sectors have entered the North American market in the past five years. A decade ago, just four companies — Apple, Google, SC Johnson and Walmart — had signed a new type of deal to purchase renewable power.

Adoption of the deals was slow at first partly because they are fairly complicated. They don’t actually involve transmitting renewable energy directly from power plants to corporate facilities, or placing solar panels and wind turbines on site — although those are options some companies choose.

Instead, the deals tracked by the Business Renewables Center see companies enter into agreements to purchase power from generators, which directly supports the development of new renewable energy projects like wind and solar farms.

“It’s become a lot more understood as more companies have done these deals,” said Haley. “There’s been a lot of shared learning among corporate buyers of renewable energy.”

“In that sense, the community has been a big aspect in terms of allowing new buyers to come into the space.”

The technology sector remains the biggest clean power buyer, but Silicon Valley is no longer dominating renewable energy purchases like it used to.

Telecom firms like T-Mobile and AT&T and companies that make consumer goods, including General Mills and Nestle, have emerged as big buyers. Now, financial firms such as Goldman Sachs and J. P. Morgan Chase and heavy industry players like Cummins are getting in the game.

Of the 19 renewable energy purchases announced last year, 14 of the companies were first-time buyers, according to a count kept by the Business Renewables Center.

Companies have now signed deals in half of the states across the United States, up from just seven states five years ago. Texas, the national leader in wind power, tops the list with 31 deals signed through the first quarter of 2018.

Some of the biggest buyers are now using their size and influence within their sectors to amplify their green ambitions.

Walmart launched a program last year to convince its suppliers to purchase renewable power. Dubbed Project Gigaton, it aims to cut emissions equal to removing 211 million passenger vehicles from the roads.

Apple suppliers have also pledged to work with the tech titan to purchase or generate 4 gigawatts of renewable power by 2020.

Haley acknowledges that these companies have the market heft to influence their suppliers, but he says smaller corporations also can help set goals and standards for their supply chains.

These companies can wield their buying relationships with suppliers to convince them to go green, he says. They can also share their experience and expertise to help suppliers achieve clean energy goals.

“They’re going to need to play that role to be really successful in transitioning the supply chain to clean energy,” he said.

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