Why unexpected companies embrace renewable energy

Wind farm--renewable energy

Wind farm

Corporations you might never have guessed have begun to make significant investments in renewable energy. And that despite legal uncertainty as the administration’s Clean Power Plan awaits a Supreme Court decision before it can go into effect.

Google bought the most wind energy last year. Again. But first time buyers, including companies not known for support of environmental causes made two-thirds of business purchases.

Google bought 1,638 megawatts. Third-place Facebook bought 338 megawatts. Here are some other significant purchases:

  • Walmart—309
  • Ikea—263
  • Owens Corning—250
  • Dow Chemical—200
  • Mars—200
  • Procter & Gamble—165
  • Kaiser Permanente—153
  • HP—112
  • Starwood—102
  • Philips—65
  • General Morors—64
  • SC Johnson—54
  • Lockheed Martin–30

Renewable energy: what’s in it for these companies?

Why are these and other companies signing long-term contracts for renewable energy? For one thing, shareholders are beginning to demand that companies set and meet targets for sustainability.

Dow Chemical has been on the list of environmental villains for decades. Last week I mentioned its partnership with The Nature Conservancy. It also aims to keep its emission of greenhouse gas below its 2006 levels and use 400 MW of clean energy by 2025.

Owens Corning has put solar arrays on its locations all over the world. Its goal, however, is to reduce emissions of greenhouse gas by 50% this decade.

Its chief sustainability officer Frank O’Brian-Bernini says, “In order to meet a goal that aggressive, it was very clear to us we needed a renewable energy strategy that was very much larger than we could imagine with on-site projects.”

Corporate goals alone, however, do not fully explain why so many companies started to purchase wind and/or solar energy last year. Wind energy is already cost-competitive with fossil fuels. It accounts for more than 75% of the capacity purchased last year. Solar will soon reach that point.

In the recent past, corporations have been reluctant to enter long-term energy contracts. Falling prices have compelled them to take a second look. They are beginning study the necessary legal and accounting details. Google has made investing in renewable energy work. Its success gives other companies a model to study.

Here’s another reason: Solar and wind energy are becoming not just inexpensive, but reliable.

Bottling electricity

solar panel array -- renewable energy

Solar array in Austin, Texas.

In 2013, Gov. Jerry Brown of California declared, “We can’t just rely on sunlight. We’ve got to bottle the sunlight.

That same year, the legislature required the California Public Utilities Commission to determine targets for the amount of storage each investor-owned utility should purchase.

Predictably, the utilities complained that storage was too expensive and undependable. But in November 2014, Southern California Edison announce that it would purchase 260 MW of storage. That’s more than five times the 50 MW target set by the Public Utilities Commission.

It had carefully investigated available storage options and compared them with other resources. The study determined that storage is both reliable and cost-effective, a resource with advantages for the company far beyond simply meeting a government mandate.

Google’s experience encouraged other companies to buy renewable energy. Southern California Edison’s experience will encourage other utilities to store it. Intermittency of the sun and wind have provided the most compelling arguments against renewable energy. They no longer hold water.

As storage becomes more commonplace, more companies will see fit to invest in renewable energy.

Biogas

hog waste, biogas, renewable energy

Hog waste lagoon, effluent pump

Solar and wind power provide the best-known renewable energy. Biogas also has promise.

It can not only provide energy, but it can solve another major environmental and health problem: manure lagoons.

North Carolina’s Renewable Energy Portfolio Standard, established in 2007, sets targets for swine and poultry waste. They are very modest.

Swine waste need supply only 0.2% of electricity generation by 2019, for example. Each investor-owned utility must meet its share of the state’s waste.

Duke Energy has announced an agreement with Carbon Cycle Energy to buy methane from swine and chicken waste. It will use that waste to generate electricity in natural gas-fired plants. The agreement joins Duke’s similar agreements with other similar facilities.

In this case, Duke is simply complying with a state mandate. For years, pilot programs all over the country have demonstrated the viability of various ways of converting manure to energy. Extracting methane and selling it to a utility is only one of them.

I have not investigated how many other states require utilities to use agricultural waste. I hope North Carolina is not unique. And I certainly hope that, like Southern California Edison’s purchase of storage, other utilities will find a way to benefit from using agricultural waste that go beyond simply complying with a regulation.

Companies beside utilities can conceivably invest in biogas. In 2010 Hewlett-Packard engineers estimated that manure from 10,000 cows could power a data center with about 1,000 servers. That’s a lot more cows than are ever gathered in one place, and the company didn’t follow up on the idea. But maybe someone will.

Sources:
These Old-School Companies Are Going Big with Solar and Wind / Christina Nunez (National Geographic, March 7, 2016)
How California Legislators, Utilities and Industries United to Bottle the Sunlight / Janice Lin (Renewable Energy World, March 21, 2016)
Duke Energy Signs Deal to Turn Pig Poop into Electricity / WRAL (March 21, 2016)

Photo credits:
Wind farm. © Copyright Stephen Craven and licensed for reuse under this Creative Commons Licence
Solar farm. Photo by Larry D. Moore. Public domain from Wikimedia Commons.
Hog waste lagoon. Some rights reserved by DefMo.


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