Major US Companies: Unmet Renewable Energy Demand Requires Market Shift
The companies – Bloomberg, Facebook, General Motors, Hewlett-Packard, Intel, Johnson & Johnson, Mars, Novelis, Procter and Gamble, REI, Sprint, and Walmart – are hoping the principles will open up new opportunities for collaboration with utilities and energy suppliers to increase their ability to buy renewable energy.
With a combined renewable energy target of 8.4 million megawatt hours (MWh) per year through 2020, the 12 participating companies are seeking a market shift to achieve their sustainable energy goals.
Large-scale buyers often have to work around traditional utilities to purchase renewables at competitive prices at the scale they need, increasing complexity and transaction costs. WWF-US and the World Resources Institute (WRI) recognized the need for clearer guidelines and convened leading companies to create the Buyers’ Principles.
“These companies are leading the market in creating demand for renewable energy. The Buyers’ Principles provide sound guidance to the market providers,” said Suzanne Apple, senior vice president for private sector engagement for WWF. “Some of America’s largest companies are embracing renewable energy, and their collective demand requires the market to keep pace.”
The Buyers’ Principles outline six criteria that would significantly help companies meet their ambitious purchasing goals:
1. Greater choice in procurement options,
2. More access to cost competitive options,
3. Longer- and variable-term contracts,
4. Access to new projects that reduce emissions beyond business as usual,
5. Streamlined third-party financing,
6. Increased purchasing options with utilities.
“Supplying renewable energy efficiently enables the scale of deployment necessary to achieve carbon neutral operations,” said Kevin Rabinovitch, global sustainability director for Mars Incorporated. “The Renewable Energy Buyers’ Principles are a powerful way to bring energy suppliers and consumers together, enabling us to work creatively to maximize the inherent benefits that come from clean energy generation with more predictable costs.”
The principles address several major obstacles large companies face in procuring and installing renewable energy.
For example, large buyers find current renewable energy markets are complicated to navigate and don’t deliver the products corporate customers are looking for. The sheer volume of renewable energy needed to meet their goals demonstrates both a clear demand and a market opportunity for any provider who can deliver what they need.
“We know cost-competitive renewable energy exists but the problem is that it is way too difficult for most companies to buy,” said Amy Hargroves, director of corporate responsibility and sustainability for Sprint.
“Very few companies have the knowledge and resources to purchase renewable energy given today’s very limited and complex options. Our hope is that by identifying the commonalities among large buyers, the principles will catalyze market changes that will help make renewables more affordable and accessible for all companies.”
“These Buyers’ Principles lay the groundwork for partnerships to help energy buyers like us go further faster,” said David Ozment, senior director of energy for Walmart.
“We know our company’s goal to be supplied by 100 percent renewable energy is good for business and good for the environment. If we can buy renewable energy for less, we can operate for less — and we can pass on the savings and a cleaner energy future to our customers and their communities. We hope others across the energy ecosystem will join us in making these principles a reality.”
The Buyers’ Group is an informal consortium of companies interested in overcoming the obstacles to buying renewable energy and sharing best practices – not a power purchase group. The initial signatories are pioneers, but the group is expanding as more companies recognize the need for market change to seize the opportunities around renewable energy.
“To meet their near-term renewable energy goals these 12 companies alone need over 8 million MWh of renewable energy, which is enough electricity to power nearly 800,000 homes every year,” said Letha Tawney, senior associate for WRI.
“When simple and cost-competitive renewable energy options appear, we find other innovative companies flooding in behind the leaders. Offering products that fit the Buyers’ Principles promises to unlock even more demand and opportunity for renewable energy.”
The principles evolved from a collaboration between WWF and the Rocky Mountain Institute (RMI) to identify barriers to corporate achievement of renewable energy targets. The groups convened a Corporate Renewable Energy Buyers’ Day in 2013 to prioritize possible solutions – resulting in RMI creating the Renewables Resource Center and WWF partnering with WRI to develop the new Buyers’ Principles.
The Renewable Energy Buyers’ Principles are available at: www.worldwildlife.org/CorpRenewables.
WWF is one of the world's largest and most respected independent conservation organizations, with over 5 million supporters and a global network active in over 100 countries. WWF's mission is to stop the degradation of the earth's natural environment and to build a future in which humans live in harmony with nature, by conserving the world's biological diversity, ensuring that the use of renewable natural resources is sustainable, and promoting the reduction of pollution and wasteful consumption.
panda.org/news for the latest news and media resources
The World Resources Institute (WRI) is a global research organization that spans more than 50 countries, with offices in the United States, China, India, Brazil, and more. Our more than 450 experts and staff work closely with leaders to turn big ideas into action to sustain our natural resources—the foundation of economic opportunity and human well-being. www.wri.org