In 2024, companies globally signed a record-breaking 62.2 GW of renewable energy Power Purchase Agreements (PPAs), representing a remarkable 35% increase compared to the previous year. These long-term contracts, where businesses procure clean energy directly from solar or wind projects, indicate a significant transformation in corporate energy sourcing strategies. Notably, there was also a surge in new buyers, with 157 companies in Europe entering into their first PPAs.
In the Asia-Pacific region, PPA activity reached 9.7 GW in 2023, reflecting a 26% rise from the prior year, largely fueled by an increasing number of companies committed to initiatives like RE100. This trend is occurring alongside a notable increase in electricity demand, which grew by 4.3%, compared to just 2.2% for overall energy in 2024. Key factors driving this demand include industrial electrification, the expansion of data centers, and advancements in artificial intelligence. Additionally, 585 GW of renewable capacity was added worldwide, highlighting the pivotal role corporations are playing in shaping the future of renewable energy and energy security.
As companies strive to meet power demand with carbon-free electricity around the clock, there is a growing emphasis on 24/7 Carbon-Free Energy (CFE) procurement. This involves sourcing renewable energy that is time-matched, local, and supplementary, effectively minimizing hourly emissions. Projects such as Google and AES’s 500 MW hybrid solar-wind-storage initiative in Virginia, along with Masdar and EWEC’s 5 GW solar-plus-storage project, serve as prime examples of 24/7 CFE implementation. Even smaller businesses, like Einstein Bagel Bros., are successfully matching 90% of their electricity needs with clean energy through bundled solutions.
Governments and industry groups are taking notice and responding accordingly. In Europe, regulations like RED III and updates to the Greenhouse Gas Protocol are encouraging more detailed data collection, hourly tracking, and regional sourcing of clean power. In Asia, innovative systems like Taiwan’s hourly T-REC and Japan’s zero-emission data centers are setting benchmarks. India is also advancing through Green Energy Open Access rules and its Renewable Purchase Obligation framework, which mandates an increasing allocation of clean energy for various industries.
To facilitate this transition, the Global Renewables Alliance has recommended several policy measures. These include enhancing access to electricity data, enabling hourly Renewable Energy Certificates (RECs), evolving auction designs to support flexible, cost-effective renewables, and promoting corporate investments in emerging technologies such as long-duration storage. Moreover, regulatory reforms are essential to prioritize power system decarbonization and improve grid planning efficiency. The move towards hourly and location-specific clean energy accounting is another significant policy change observed across various markets.
The shift towards 24/7 CFE is not only aiding corporations in their decarbonization efforts but also supporting global objectives such as tripling renewable capacity by 2030. This evolving landscape of corporate renewable sourcing is contributing to the development of an energy system that is prepared for the future, aligning with both environmental and economic goals.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/accelerating-corporate-renewable-sourcing-in-the-global-shift-to-24-7-carbon-free-energy/
