After Trump’s Paris pullout, US companies push for renewables
When President Trump announced on June 1 last year that the United States would exit the Paris climate deal, many of America’s largest corporations said they would honor the agreement anyway, vowing to pursue cleaner energy and cut emissions on their own.
A year later, there’s one area where that pledge is highly visible: renewable energy. Dozens of Fortune 500 companies, from tech giants like Apple and Google to Walmart and General Motors, are voluntarily investing billions of dollars in new wind and solar projects to power their operations or offset their conventional energy use, becoming a major driver of renewable electricity growth in the United States.
“You’re definitely not seeing corporations slow down their appetite for renewables under Trump — if anything, demand continues to grow,” said Malcolm Woolf, senior vice president for policy at Advanced Energy Economy, a clean energy business group. “And it means that many utilities increasingly have to evolve to satisfy this demand.”
One big question, however, is whether these corporate renewable deals will remain a relatively niche market, adding some wind and solar at the margins but not really making a sizable dent in overall emissions, or whether these companies can use their clout to transform America’s grid and help usher in a new era of low-carbon power.
Last year in the United States, 19 large corporations announced deals with energy providers to build 2.78 gigawatts worth of wind and solar generating capacity, equal to one-sixth of all of the renewable capacity added nationwide in 2017, according to the Rocky Mountain Institute’s Business Renewable Center. (Power companies themselves added much of the rest, often in response to state mandates.)
That trend appears to be accelerating. Corporations have already announced deals for another 2.48 gigawatts of wind and solar in the first half of 2018, as companies like AT&T and Nestlé join the search for cleaner power to fulfill their sustainability goals and take advantage of the rapidly declining cost of renewables.
“We didn’t intend to do this as a statement about Paris, though it has become a statement that we’re definitely still in,” said Brian Janous, general manager of energy at Microsoft, which has so far bought enough wind and solar power to match 50 per cent of the demand from its global data centers.
“But with how fast wind and solar prices have fallen, we see this as something that makes financial sense,” he said.
At least 22 companies in the Fortune 500 have committed to buying enough renewable power to match 100 per cent of their electricity use in the years ahead. And some analysts say these goals could help spur electric utilities to continue reducing their own emissions even as the Trump administration rolls back Obama-era policies like the Clean Power Plan, a regulation focused on reducing carbon emissions from power plants.
“We think this is a major trend,” said Lisa Wood, vice president of customer solutions at the Edison Electric Institute, a major utility trade group. “Customers are becoming the driver.”
It can often be difficult for a company that isn’t a utility to procure large quantities of renewable electricity on its own. Walmart has installed on-site solar panels on the roofs and parking lots of at least 350 stores, but not every company has that much real estate in play.
Another approach: In deregulated electricity markets, like California or Texas, companies can sign long-term power purchase agreements with energy providers to build new solar or wind facilities. The electricity from these projects typically feeds into the local grid, mixing with electricity from other sources such as coal or natural gas, but the company can legally claim the wind or solar power as its own by buying the renewable energy certificates generated by the project.