When it comes to renewables, customers are like watermelon seeds
Editor's note: The following is a viewpoint article by Adam Browning, executive director of Vote Solar. If you are interested in submitting a guest post, please review these guidelines.
As the price of fossil fuels remains volatile and their true costs become increasingly evident, clean energy sources have become an increasingly attractive investment. In fact, it looks as if the transition to a clean energy economy will occur much faster than anyone thought. And it will be particularly interesting to see how that renewable revolution changes the roles of our powerful utilities and some of their most powerful customers.
Corporate America has taken note of clean energy’s cost-competitiveness and is now one of the major forces driving this transition, with nearly half of all Fortune 500 companies already having established targets to cut carbon pollution and to purchase increasing amounts of renewable energy.
For instance, just recently Toyota Motor North America announced a commitment to 100% renewable energy at its new, 2.1-milion-square-foot headquarters in Plano, Texas. For its part, Google recently contracted with Duke Energy to purchase 61 megawatts worth of solar power - enough “to power one of our data centers” - in North Carolina. And Walmart recently announced a major wind power purchase deal in Texas, as the retail giant strives to move towards 100% clean energy. They’re not just doing it out of the goodness of their hearts but for their bottom line.
The result of all this movement is that corporate purchases of renewable energy have now hit an inflection point and will only grow exponentially from here.
In order to access more renewables, many companies are already pushing for energy deregulation and competition, as opposed to remaining tied to monopoly utilities. For instance, in Nevada, some of the largest casinos in Las Vegas are seeking to ditch NV Energy and instead purchase more solar power from other sources. In addition, companies like Tesla and Switch (a Las Vegas-based data company) are “backing a ballot initiative to create a competitive electricity market, a move that would effectively end NV Energy’s monopoly.” In Michigan, we’re seeing a similar move by major companies, including General Motors.
Some corporations even want to become their own utilities/power generators.
For example, Apple recently filed with the Federal Energy Regulatory Commission (FERC) to essentially become an independent power producer (IPP), selling electricity to end users and in wholesale power markets.
Given the inevitable trend away from fossil fuels and towards solar and wind, it makes sense that the Edison Electric Institute (EEI)—the main trade association for U.S. investor-owned electric utilities—is recognizing, if somewhat belatedly, the enormous growth in corporate adoption of renewable energy. The trade group recently published a whitepaper on the subject. The question is, why EEI would issue this report while at the same time fighting against the very policies that would enable corporate consumers and others to invest in renewables?
If actions speak louder than words, there is little doubt as to EEI’s true position on the evolution of our electric system. As reported by the Washington Post, in 2012 the trade association launched a multi-year anti-solar campaign to weaken net metering, one of the most important state policies for onsite commercial solar generation. Since then we’ve seen a barrage—42 states in the second quarter of 2016 alone—of proposals from utilities and their allies to undermine the customer economics of solar power.
We’ve also seen EEI’s member utilities fighting to restrict customer access to one of the nation’s most common solar financing options, Power Purchase Agreements (PPAs), in Florida, Missouri, North Carolina and other states. In each case, utility interests have lobbied hard to prevent businesses from sourcing clean, stable renewable energy, while major corporations as varied as IKEA, Unilever and Facebook urge state lawmakers to support it.
May we suggest that a business model based on denying your customers what they want could use some improvements? Customers are like watermelon seeds—the harder you squeeze them, the farther away from you they end up.
If utilities don't evolve to enable commercial customer demand for more renewable energy options, they may go the way of the dodo.
The overall trend is clear: businesses and energy customers of all kinds are increasingly demanding the choice to purchase as much clean and affordable energy as possible, from whoever they want to buy it, at the best price they can get for it. When it comes to renewable energy options, what’s good for the Google is good for the gander—and people are corporations too! We are all demanding energy progress, something that some utilities have tended to fear and resist more than embrace and encourage. Hopefully, that situation can change for the better – both for the sake of the utilities, as well as for the clean energy-demanding consumer.