ORIGINAL REPORTING: Corporate demand pushes new generation of utility green tariffs
Corporate demand pushes new generation of utility green tariffs; Utilities are rolling out more sophisticated green tariffs to satisfy corporate sustainability goals. Can they prevent key accounts from defecting to independent suppliers?
Herman K. Trabish, May 4, 2017 (Utility Dive)
Editor’s note: Green tariffs continue to grow as more big corporate buyers demand access to renewables from their utilities.
Corporations are hungry for green energy — over 70% of Fortune 500 companies have climate or renewable power goals. Utilities know they must satisfy this growing demand or risk losing business to independent renewable energy developers. To do so, many are designing innovative rates — labeled green tariffs — to provide wind and solar power to corporations like Facebook, Yahoo and Amazon. Green tariffs have come a long way in recent years as renewable energy costs declined and corporate demand intensified. The first generation were relatively simple — typically involving utilities charging a premium price for the output of a renewable energy facility or the purchase of renewable energy credits. Now, as the cost of long-term PPAs with independent power developers drops, utilities are developing more sophisticated tariffs to satisfy a new generation of corporate goals and customers.
To date, 17 such green tariffs have popped up in thirteen states. Since 2013, green tariffs have helped spurred over 900 MW of new renewable energy capacity, and over 450 MW are currently under negotiation through long term power purchase agreements and contracts. “New buyers with new load, especially data centers, are driving new attention to green tariffs by utilities in regulated markets,” according to Roger Ballentine, a former Clinton White House climate and environment officer and current president of Green Strategies, a sustainability consulting group. “But the early experience has been at best mixed and maybe even disappointing because regulated utilities have been slow, and in some cases, reluctant to respond to demand.” That’s beginning to change as more corporations look beyond default utility service to satisfy sustainability demands and utilities move to a new level of service… click here for more
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