It’s no secret that renewable energy is becoming cheaper, and while we’ve seen companies like Google and Microsoft investing in utility-scale renewables, what about mainstream corporate America? Are large corporations jumping on the clean energy bandwagon or are they dragging their feet? As a data analyst at EDF Climate Corps, I turned to the numbers for answers. Fortunately, I didn’t have to look far. An analysis from our recently release report: Scaling Success: Recent Trends in Organizational Energy Management, says it all.
For almost a decade, EDF Climate Corps has been partnering with business to save money and reduce greenhouse gas emissions by improving energy efficiency through our graduate fellowship program.
As I followed the numbers, a new clean energy trend stood out: over the last 5 years, clean and renewable energy projects have grown five-fold, with 1/3 of our partner organizations working on at least one clean energy project in 2015. Companies have been using their EDF Climate Corps fellows to decipher the complex landscape of technologies, policies, procurement strategies, and financing options for renewable energy. As we tally the results for our 2016 fellowship program, we expect the focus on clean energy to continue to grow, and don’t plan on it stopping anytime soon.
Following the money
But why have we observed this recent uptake in clean energy projects? It seems to be “all about the Benjamins.” Our data shows that fellows are increasingly able to build a solid business case for clean energy projects. In just 2 years, the average payback for clean energy projects decreased dramatically from around 4 years to under 2 years and we’ve seen a surge in positive Net Present Value (NPV) clean energy projects. This tell us that clean energy projects are becoming increasingly cost competitive – a mirror image of industry trends.
Which brings us back to our initial question – are large corporations jumping on the clean energy bandwagon? Yes, mainstream corporate America IS adopting clean and renewable energy- and they are doing it cost-effectively. The winds of change are blowing in the right direction (and hopefully through a wind turbine!) and our EDF Climate Corps fellows are proving that investment in renewables makes good business sense. However, there are still challenges to getting clean energy adoption at scale. Many renewable energy projects with large returns also require large upfront capital investments, and although the projects may have a positive NPV, some still fall outside the required payback period for corporations. We’ve seen that lack of funding and competing internal priorities are still major barriers to implementation.
How companies can continue to drive forward
And so, a new question emerges – what should companies be doing to drive clean energy projects internally? First, corporate leadership should set targets for renewable energy procurement and benchmark against their peers. Second, energy managers should pilot clean energy projects to demonstrate their viability. These pilots can serve as proof points for future projects and larger-scale investments. While navigating the complex clean energy alphabet soup (PV, PPAs, RECs, RPS, ITC, etc.) can be tough, especially given the nuances in state level policy and regulations, partnering with a third-party organization (such as a program like EDF Climate Corps, another NGO or a vendor) is a great way to accelerate your clean energy projects. You just may find that making the business case for clean and renewable energy isn’t as hard as you thought.
I invite you to learn more about what 8 years of EDF Climate Corps data tells us about trends in energy management and clean energy by reading our Scaling Success report.