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Decarbonizing Corporations Today Builds Tomorrow’s Energy Network

As corporations adopt clean energy and solutions to decarbonize their operations, they’re playing a pivotal role in creating the cleaner electric grids and off-grid resources we need to bend the curve on carbon emissions.

Decarbonizing Corporations Today Builds Tomorrow’s Energy Network

Oct 30 2024  |  9 min read

This week, the VERGE conference is underway in northern California, and companies are showcasing a diverse and fast-scaling array of approaches to reduce their environmental impacts that’s not only innovative… it’s inspiring. It’s clear from the range of discussions taking place that many of the technologies we need to curb emissions are mature and at commercial scale.

What I think isn’t as clear: as corporations adopt clean energy and solutions to decarbonize their operations, they’re playing a pivotal role in creating the cleaner electric grids and off-grid resources we need to bend the curve on carbon emissions.

Every day, new renewables and energy storage projects are modernizing, decentralizing and digitizing our electricity grids, providing greater access to both energy data and dispatchability, and accelerating growth of new clean generating capacity across the network. Leading companies are already proving out more advanced strategies for decarbonizing their operations. At the same time, innovators across the corporate sector are validating and scaling up in the field vital, first-of-a-kind decarbonization technologies and opening the door to much more widespread adoption.

 

The world is moving fast to adopt clean energy – but appetite is growing in parallel

According to the International Energy Agency, 30% of global electricity was supplied from renewable sources in 2023, and that share is projected to grow to 37% by 2026, driven in part by the heavy expansion of solar. Predictions made over the last 20 years for slow growth in renewables, energy storage and electric mobility have been proven incredibly wrong. Why? Because analysts didn’t foresee how each of these technologies would necessarily complement one another, accelerating overall growth.

At the same time, a parallel trend is playing out. Because corporations are adopting renewable energy and setting ambitious net-zero targets, they’re coming to the table with a huge collective appetite. According to Bloomberg New Energy Finance, power purchase agreements (PPA) totaling over 22 gigawatts of renewable energy capacity were signed in the first half of 2024 alone, representing 36% growth in transactions year-over-year. All signs point to deals being signed as quickly as projects can be planned and power used as soon as generation can be brought online.

 

Organizations are setting ambitious targets but adopting solutions at different speeds

The largest renewable energy buyers in the world – Amazon, Meta, Google and Microsoft – are leading by far in terms of sheer volume under contract, pursuing some of the most advanced clean energy goals in the world, even being willing to pay premiums to secure the resources they need to meet them. These include powering facilities 24/7 with carbon-free energy, honing their procurement strategy to have specific emissions impacts on local grids, even focusing procurement strictly through emissions reduction goal lenses rather than traditional megawatt or megawatt-hour volume metrics.

Companies at the leading edge have started to branch out beyond traditional PPAs for solar, wind and battery storage to pursue solutions that bring them closer to “baseload power” procurements (i.e., matched to consumption across as many hours of their operating day as is feasible):

  • Google is working in Nevada with NV Energy, the local utility, and Fervo Energy, and Meta is working with Sage Geosystems, all to deploy advanced geothermal projects to deliver dispatchable carbon-free energy in challenging markets;
  • Amazon procured a 960 MW data center from Talen Energy adjacent to Talen’s Susquehanna Nuclear facility, which provides 24/7 carbon-free energy for the campus;
  • Iron Mountain is building out a combination of utility-scale solar, natural gas and battery storage resources to provide for both the power needs of nine data centers at its 142-acre campus in Virginia and ensure local grid resilience amidst huge growth in power demands in the area.
  • Lastly, Microsoft, Google and Nucor announced a joint procurement for 24/7 carbon-free/renewable energy to accelerate investments in First-of-a-Kind (FOAK) technologies like long-duration energy storage.

Some of these projects are being conceived as off-grid or grid-adjacent, due in part to the challenges many projects face in securing interconnection to the grid. Because these companies have the resources, they’re showing what a future can look like, with more onsite or microgrid projects using multiple generation and/or flexibility types, and more directly contracted resources, rather than working through a utility or marketplace.

Once you look beyond these leading-edge customers, we’ve seen that companies are moving at a wide range of speeds and scales to decarbonize:

  • Organizations earlier in the journey generally focus on sourcing or offsetting electricity use with renewable energy certificates (RECs) – or are focusing on simpler needs like meeting daytime power requirements with onsite or offsite solar, or managing peak electricity demand to control costs.
  • Others still fall in the middle – needing both bulk clean energy to meet their operational or supply chain needs, and sophisticated tools and flexibility to manage local loads.

The coming stage of the energy transition will see companies procure increasing shares of clean energy, some of it time-matched to demand – but how and to what degree will reflect where they are in their journey. Enterprise customers will need to balance ease of sourcing and cost with other objectives like resilience, “always-on” supply or goals for local or regional grid decarbonization.

 

Clean energy is critical to decarbonization – but so is transparency and flexibility

Clean energy supply isn’t the only way that organizations are driving this transformation of the grid. It’s also coming in the form of other infrastructure that is changing how electricity is sourced, stored and used: in particular, energy storage and charging infrastructure for electric vehicles.

Energy storage and renewables are the chocolate and peanut butter of this generation. The ability to store electricity enables us to maximize the output of renewable energy generation, make that output more dispatchable, and minimize how much we lean on fossil fuels to balance how we meet demand. With every megawatt of battery storage capacity we add to the mix, that’s new flexibility that can help manage resilience in the electricity system overall.

Battery projects are growing – in scale (megawatts), duration (hours dispatched at a time) and applications. They’re supporting the grid during moments of peak demand, a role for which we’ve historically relied on natural gas “peaker” plants.

And in some places where new transmission capacity is needed to move renewable energy, battery storage is filling in gaps and helping make better use of existing transmission lines, to ensure clean energy is making it to users.

Electric vehicles are also coming to market in a wide range of forms, duty classes and ranges, enabling companies to reduce emissions from both passenger and freight transportation. But electric vehicles are both part of the new demand on the grid and a potential resource for adding flexibility, thanks to their large batteries.

Fleet electrification helps enterprise customers reduce reliance on fossil fuels for freight transport. However, to achieve sustainability objectives, organizations should align how they source power with how they charge electric vehicles.

EV charging solutions need to grow in both speed (via fast chargers) and reach to ensure fleet needs are met, whether for long-haul or last-mile delivery use cases, but the potential is massive. If charging hardware and software allow us to adjust how vehicles charge to accommodate other loads on the grid, these resources can work together to minimize strain on the grid when charging, or even soak up excess power from solar and wind farms to make the most of those assets.

All of these technologies – renewables, energy storage, electric mobility, even smart building technologies – are creating new layers of data access and transparency into our energy mix works, hour-by-hour, even minute-by-minute. Why does that matter? Because the more we understand about where and when power can be generated, stored and delivered, the more we can shape how we source and use electricity to meet our goals on emissions.

 

Solutions are available in most sectors where we need to decarbonize

In short, the appetite, tools and ambition to drive large-scale decarbonization exist, and as companies work to decarbonize, whether they realize it or not, they’re helping create the electricity system we all need to power our shared future sustainably.

How can companies find their sweet spot in the transition and source the right solutions to meet their needs? The right partners – much like my organization, MN8 Energy – can help you navigate the process no matter where you are on the journey, and identify and make the most impactful projects to your enterprise a reality.

But what’s most important is we keep moving forward together, sharing knowledge and creating partnerships that meet our growing demand for clean energy. Pursuing innovation together will help us build supply overall and move more nascent technologies up the learning and commercialization curves so they are ready to help us at the next stage.