TODAY’S STUDY: Companies Going 100% Renewable
Going 100% renewable: how committed companies are demanding a faster market response
December 2019 (RE100 Progress And Insights)
In its biggest year yet, RE100 grew by over a third, surpassing the 200-member milestone. If they were a country, RE100 members would be the 21st largest electricity consumer in the world. RE100 has continued to expand geographically, with 44% of new joiners in 2019 from across the Asia Pacific. What matters most, of course, is the speed at which companies make progress. 2028 is the average target date for RE100 members to achieve 100% renewable electricity. One in three are already over 75% toward their goal, and one in two are being driven by cost savings. But despite falling costs1 , renewables are still marginal in a small number of countries where companies are struggling to get access. Without decisive action, these countries risk losing out on billions of US dollars in investment from RE100 companies. And without decarbonized grids, the planet remains exposed to catastrophic climate change.
By engaging with governments and energy suppliers, leading members are starting to overcome policy challenges and technical barriers to source renewable electricity. They are creating new routes for others to follow – and 44% are now engaging suppliers. Over the last year, we have been working closely with members to amplify their demand, developing new partnerships in the Taiwanese market and in Australia. The leadership of members coupled with the geographic expansion of RE100 is triggering broader system change – such as in the Republic of Korea where a new mechanism is being introduced by the Government to enable companies to meet their RE100 goals.
THE QUESTION IS, HOW DO WE GO FASTER?
2020 marks the beginning of the Climate Decade – ten years to halve greenhouse gas (GHG) emissions and put the world on track to reach net zero by 2050. Our members are playing their part and aim to scale up their leadership in the coming year. Through RE100, they have a platform to do so. We will be making sure that their voices are heard loud and clear by governments and the energy sector around the world, who will need to rapidly respond to the increasing demand for clean and affordable electricity…
Scale, Ambition and Progress
A GROWING AND DIVERSIFYING MEMBERSHIP
Among the world’s most influential companies, clean energy is increasingly becoming the norm. RE100 now brings together more than 200 multinationals committed to 100% renewable power. 56 have joined since the last annual report – our biggest growth year to date – taking the total membership to 211. The collective electricity consumption of our members is on par with a medium sized country. They consumed 228 TWh/yr in 2018, comparable to Indonesia or South Africa3. That’s an extra 40 TWh/yr in demand for clean energy compared to the previous year. RE100 has continued to expand to new frontiers, with 44% of the growth in the Asia Pacific region. Japan is now home to the third largest number of members (28) – rapidly catching up with the UK (37). Australia grew from 1 to 8 members, including all of the country’s major banks. Two more companies joined from mainland China – the first to do so since the Paris Agreement was signed…
Beyond their individual commitments to 100% renewable electricity, RE100 members have been innovating, collaborating, and constantly challenging themselves and each other to accelerate the clean energy transition.
TRANSFORMING ELECTRICITY GRIDS
In 2018, RE100 members continued to turn their renewable electricity sourcing strategies toward approaches that have the highest direct impact on grid decarbonization. It was once again a record-breaking year for PPAs – a mechanism through which corporate buyers contract directly with a project developer, usually enabling renewable energy capacity to be added to the grid. PPAs accounted for 19% of the renewable power sourced by members in 2018 (up from 16% the previous year). This amounts to 14 TWh of electricity consumption.
Their popularity reflects a global trend, with companies signing contracts totalling 13.4 GW of renewable capacity globally in 2018, according to BloombergNEF5. These new projects will come online over the next few years, and should see more renewable electricity being sourced this way by RE100 members.
In 2018, members also generated more of the renewable electricity they consumed – over 3 TWh in 2018 (4% of the total), with 104 disclosing companies using this approach…
Companies are using their voice and the power of collective action through platforms like RE100 to transform policies and markets at scale. The Climate Group and CDP have been supporting RE100 members to engage with policy makers to advocate policy frameworks more favorable to renewables. Members are also working with utilities to design new renewable electricity products that would be made available to all. But there is potential to do much more – thankfully, 49% of responding members are planning to partner with and influence stakeholders by 2020 to help create markets for renewables…
As the corporate movement on renewable electricity continues to expand, the impact of the RE100 initiative in accelerating the clean energy transition is only going to grow.
As members get closer to their target dates, more of them now need to clean up the electricity they use in the more challenging countries for renewable power sourcing. Led by The Climate Group in partnership with CDP, and supported by a growing set of regional delivery partners, RE100 will remain a trusted initiative for leading companies.
Many more businesses from different countries will join and commit to 100% renewable power. Their leadership will deepen as they choose impactful sourcing solutions, bring their suppliers on board and engage with policy makers and the energy sector.
By expanding into new regions in 2020, the initiative will amplify those commitments, and provide an essential platform for companies to collaborate to address technical barriers and help design suitable policy and market solutions.
2020 is the beginning of the Climate Decade – ten years to halve global GHG emissions and put the world on track to achieve net zero emission by the middle of the century. The countries and the energy companies all along the value chain that fail to shift to renewables will be the first ones to pay the price.
The private sector faces the ultimate test to showcase leadership and seize opportunities now that advance the future clean economy…