Limited availability of renewables, lack of opportunities for green Power Purchase Agreements (PPAs) and prohibitive costs are hampering businesses clean power ambitions, RE100 has warned.
In its latest disclosure report, covering 2021, the organisation noted that corporate appetite for power purchase agreements is growing incrementally and its members are now sourcing more of their renewable electricity through PPAs than ever before. 28% of reported procurement of renewable electricity is done through PPAs, up from 26% in the 2020 report.
According to the document, RE100 members are now sourcing nearly 45% of their electricity needs from renewable sources, up from 41% in 2020 and representing 152TWh of renewable electricity. 61 members, meanwhile, reported they are sourcing all their electricity from renewable sources.
But globally, more than half of businesses said they faced “significant challenges” in sourcing renewables power. Limited availability, lack of procurement opportunities, and prohibitive costs were cited as the top three issues preventing them from achieving their clean power ambitions. Asian markets were identified as regions where clean power procurement was proving most difficult, with members highlighting barriers to securing renewables capacity in South Korea, Japan and China. Traditionally fossil fuel-reliant countries, including Australia, Russia, and Saudi Arabia, were also highlighted as challenging.
The report also raised concerns that regulatory barriers are hampering the business world’s transition to net zero and urged policy-makers and businesses to collaborate to tackle the barriers to renewables procurement, arguing that its rapidly growing membership was evidence of strong private sector appetite for clean power.
GridBeyond Asset Development Director Chris Smith commented:
“It is great news that more and more businesses globally are seeking out renewables PPAs and that corporate demand for renewables is gaining pace. There are significant sustainability and financial benefits that arise from well-structured and dynamic PPAs on both the generator and customer side. It’s disappointing that this report has found that some businesses have been unable to find such contracts. The opportunity for generators and customers is massive and GridBeyond is well placed to enable both parties in transacting Corporate PPA’s.”
GridBeyond Business Unit Manager – Delivering Net Zero, Jeff Power added:
“Despite net zero standards and carbon pricing not carrying substantial weight in financial models to make a widespread influence on decision making, it is very encouraging to see renewable demand increasing within corporates. Contrary to this encouragement it is deflating to see that the energy market cannot serve this demand creating a tentative nature among corporates with respect to their clean power ambitions. Renewables and CPPAs bringing additionality to the grid are a critical path towards net zero for corporates and indeed countries alike. This further highlights the concerns stemming from the report and reinforces the development of GridBeyond’s CPPA sourcing and transacting business supported with our bespoke multipurpose AI driven platform.”
By aggregating renewables with batteries and flexible load, at GridBeyond we create a high performing portfolio of assets with the ability to earn additional revenues through traded markets ensuring renewables generators maximise revenue for every MW generated.