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6 Ways Utilities Are Meeting Corporate Demand for Renewable Energy
By Letha Tawney, Celina Bonugli and Daniel Melling
Utilities are breaking away from traditional electricity products to offer customers access to large-scale renewable energy. Until very recently, utilities did not differentiate the sort of power they offered customers. With very few exceptions, everyone shared in the cost and used electricity from the same fleet of power generating stations.
But over the past four years, even regulated U.S. utilities have begun to offer new, large-scale renewable energy options to customers. World Resources Institute data shows that across ten U.S. states, utilities now offer 13 green tariffs—programs that let customers purchase large-scale renewable energy over the grid.
We take a closer look at the trends and motivations that have made utilities important players in the rapid scale up of renewable energy to serve corporate buyers in the U.S.
1. Why are utilities stepping up?
In markets where wind and solar power have become cost competitive, utilities have more economic incentives to add renewable energy. Renewable resources just offer a great low price for the next 20 years—without the risks of fossil fuel price spikes.
Utility leaders overwhelmingly anticipate substantial solar and wind power growth in the next ten years, according to
Utility Dive's 2017 survey of the sector. Among utility executives, 71 percent say utility scale wind will increase moderately or significantly over the next ten years and 82 percent predict the same for utility scale solar.
Recently, Pat Vincent-Collawn, CEO of PNM Resources announced a plan to eliminate coal by 2031 and move toward renewables and natural gas, calling it "the best, most economical path to a strong energy future for New Mexico." WEC Energy Group CEO Allen Leverett told shareholders in May 2017 that the company is exploring solar, "probably the biggest change we've seen in last five years is solar and the cost of solar. The technology curve really has fallen fast in terms of improvement in cost."
Mid-American, a Berkshire Hathaway Energy subsidiary, has talked about their extensive investments in wind in the same way—as an effective way to keep prices low for customers. The company also used their wind investments to serve the renewable energy requirements of major data centers, such as Facebook and Google, in their service territory.
2. How big is the demand for renewable energy on the grid?
Through RE100, 90 companies have committed to 100 percent renewable power. Clean energy and greenhouse gas reduction targets are now the norm for Fortune 500 and Fortune 100 companies. World Wildlife Fund and Ceres' Power Forward 3.0 report shows that almost half of the Fortune 500 and a majority of the Fortune 100 now have climate and energy targets.
Companies with renewable energy commitments can
only go so far with on-site solar and efficiency. To meet the most ambitious targets, like a 100 percent renewable energy goal, companies have to tap into the grid and are turning to their utility to provide solutions.
Big businesses have communicated their needs to U.S. utilities. Sixty-five companies have signed on to the Renewable Energy Buyers' Principles, which tell utilities and other suppliers what industry-leading, multinational companies are looking for when buying renewable energy from the grid.
And utilities are listening. Utilities without green tariffs or state mandates are still considering new renewable energy options to attract businesses. Describing a new wind project, Appalachian Power's new president Chris Beam
told the Charleston Gazette Mail, "at the end of the day, West Virginia may not require us to be clean, but our customers are […] we have to be mindful of what our customers want."
3. How are utilities stepping up?
To meet customer demand for renewable energy, traditional utilities have now created 13 green tariff options across 10 states. In the six months since the last update to World Resources Institute's issue brief, Emerging Green Tariffs in U.S. Regulated Electricity Markets, utilities have added three more green tariffs options—including the first offered by a public power company, Nebraska's Omaha Public Power District.
States with renewable energy options are more competitive when attracting high-growth corporate business. When Omaha Public Power District announced a new green tariff to supply a Facebook data center, Tim Burke, Omaha Public Power District's president and CEO, told the Omaha World-Herald, "we have several customers right now that are putting together potential expansion projects and will utilize that (new) rate to grow."
4. What is the impact of green tariffs on the grid?
Who is using these tariffs? To date, customers have contracted for approximately 900 MW of new renewable energy under five of the tariffs. This is approximately enough electricity to power 160,000 average American homes a year. This spring, utilities and customers are negotiating hundreds more megawatts of additional purchases.
5. How can customers keep up with these new options?
World Resources Institute's interactive U.S. Renewable Energy Map: A Guide For Corporate Buyers shows all the green tariffs that utilities offer across the nation. The map also details one-on-one special contracts that customers have signed with utilities. These special contracts show a utility is willing to explore options, even if they haven't gone as far as creating a new tariff.
6. What's next?
Today green tariffs are a small part of the overall U.S. renewable energy market—reflecting their pilot status. But the programs create a runway for renewables at a time when demand is only increasing, not just from businesses, but also cities, universities, hospitals and smaller companies.
Innovative partnerships will continue to emerge between utilities and their customers as both grapple with the rapidly changing electricity sector. Green tariffs are only three years old, but with increasing demand, interest in renewables by utilities and the continued fall in renewable energy prices, green tariffs look like they're here to stay.
EcoWatch Daily Newsletter
By Patti Lynn
2018 was a groundbreaking year in the public conversation about climate change. Last February, The New York Times reported that a record percentage of Americans now believe that climate change is caused by humans, and there was a 20 percentage point rise in "the number of Americans who say they worry 'a great deal' about climate change."
England faces an "existential threat" if it does not change how it manages its water, the head of the country's Environment Agency warned Tuesday.
By Jessica Corbett
A new analysis revealed Tuesday that over the past two decades heat records across the U.S. have been broken twice as often as cold ones—underscoring experts' warnings about the increasingly dangerous consequences of failing to dramatically curb planet-warming emissions.
By Madison Dapcevich
Ask any resident of San Francisco about the waterfront parrots, and they will surely tell you a story of red-faced conures squawking or dive-bombing between building peaks. Ask a team of researchers from the University of Georgia, however, and they will tell you of a mysterious string of neurological poisonings impacting the naturalized flock for decades.
The initial cause of the fire was not yet known, but it has been driven by the strong wind and jumped the North Santiam River, The Salem Statesman Journal reported. As of Tuesday night, it threatened around 35 homes and 30 buildings, and was 20 percent contained.
The unanimous verdict was announced Tuesday in San Francisco in the first federal case to be brought against Monsanto, now owned by Bayer, alleging that repeated use of the company's glyphosate-containing weedkiller caused the plaintiff's cancer. Seventy-year-old Edwin Hardeman of Santa Rosa, California said he used Roundup for almost 30 years on his properties before developing non-Hodgkin's lymphoma.
"Today's verdict reinforces what another jury found last year, and what scientists with the state of California and the World Health Organization have concluded: Glyphosate causes cancer in people," Environmental Working Group President Ken Cook said in a statement. "As similar lawsuits mount, the evidence will grow that Roundup is not safe, and that the company has tried to cover it up."
Judge Vince Chhabria has split Hardeman's trial into two phases. The first, decided Tuesday, focused exclusively on whether or not Roundup use caused the plaintiff's cancer. The second, to begin Wednesday, will assess if Bayer is liable for damages.
"We are disappointed with the jury's initial decision, but we continue to believe firmly that the science confirms glyphosate-based herbicides do not cause cancer," Bayer spokesman Dan Childs said in a statement reported by The Guardian. "We are confident the evidence in phase two will show that Monsanto's conduct has been appropriate and the company should not be liable for Mr. Hardeman's cancer."
Some legal experts said that Chhabria's decision to split the trial was beneficial to Bayer, Reuters reported. The company had complained that the jury in Johnson's case had been distracted by the lawyers' claims that Monsanto had sought to mislead scientists and the public about Roundup's safety.
However, a remark made by Chhabria during the trial and reported by The Guardian was blatantly critical of the company.
"Although the evidence that Roundup causes cancer is quite equivocal, there is strong evidence from which a jury could conclude that Monsanto does not particularly care whether its product is in fact giving people cancer, focusing instead on manipulating public opinion and undermining anyone who raises genuine and legitimate concerns about the issue," he said.
Many regulatory bodies, including the U.S. Environmental Protection Agency, have ruled that glyphosate is safe for humans, but the World Health Organization's International Agency for Research on Cancer found it was "probably carcinogenic to humans" in 2015. A university study earlier this year found that glyphosate use increased cancer risk by as much as 41 percent.
Hardeman's lawyers Jennifer Moore and Aimee Wagstaff said they would now reveal Monsanto's efforts to mislead the public about the safety of its product.
"Now we can focus on the evidence that Monsanto has not taken a responsible, objective approach to the safety of Roundup," they wrote in a statement reported by The Guardian.
Hardeman's case is considered a "bellwether" trial for the more than 760 glyphosate cases Chhabria is hearing. In total, there are around 11,200 such lawsuits pending in the U.S., according to Reuters.
University of Richmond law professor Carl Tobias told Reuters that Tuesday's decision showed that the verdict in Johnson's case was not "an aberration," and could possibly predict how future juries in the thousands of pending cases would respond.