After RE100 members announced new commitments to renewables at the Clean Energy Ministerial in San Francisco, RE100 Campaign Director Emily Farnworth looks at the rise in companies reporting 100% renewable energy goals.
June has seen a welcome boost for the roll out of renewables across the private sector.
The U.K., U.S. China, Mexico, Sweden, and the European Commission backed a new campaign launched at this year’s Clean Energy Ministerial (CEM7), aimed to increase corporate uptake of renewable power.
The recently established Renewable Energy Buyers Alliance announced that it will expand beyond the US into new markets like India and China, helping to provide much needed capacity and expertise to support corporates wanting to access renewables.
And RE100 announced new joiners: Equinix, Tetra Pak, TD Bank Group, Interface, Inc, Dentsu Aegis Network, and Workday, Inc. Their 100% goals represent a total of 4,000 GWh in demand for renewable power – more than enough to power San Francisco.
The new members mean RE100 has now grown to a group of 65 companies committed to sourcing 100% renewable power across their global operations. It’s a phenomenal shift from where we were just 18 months ago when we launched with 12 original leading businesses.
Developers and investors should recognize that there is a very real and credible customer base to reduce the off-take risk of new projects, in turn, helping the financial viability of new developments to stack up.
And it’s not just 100% goals they should be taking notice of. Point380 analyzed 2013, 2014 and 2015 CDP data and found a surge in the number of companies reporting any kind of renewable energy target over those three years. In 2013, 77 companies reported their targets to CDP, and this more than doubled to 188 in 2015.
But what is particularly interesting is that whilst the number of companies reporting 20% - 80% renewable energy goals to CDP doubled, the number of companies reporting a 100% renewable energy goal more than quadrupled in the same period.
Perhaps unsurprisingly, the increase in companies setting targets is closely mirrored by an increase in the number of countries setting targets for renewables. A report released by REN21 recently indicated that 173 countries now have renewable energy goals and 146 have policies in place to support the growth of renewables.
There is no doubt that the climate agreement reached in Paris at the end of last year has put us firmly on the pathway to a low carbon economy. It is spurring even greater ambition from countries, companies and investors that will manifest itself in the 2016 data reported to CDP.
The business case for action
Significant financial and strategic benefits are among the compelling list of reasons to transition from fossil fuels to renewable power. Economies of scale are continuing to bring down the cost of renewables. We saw another record-breaking deal in Dubai last month with a contract price of 2.99 cents per KWh on a 800MW solar project – could it really get any lower?
When set against the uncertain future of fossil fuels – dogged by price fluctuations and the growing number of carbon pricing mechanisms – it is no wonder the world’s biggest companies are looking to alternatives. And it’s not just the economics that are attractive; the environmental, social and health benefits of renewables are also important considerations.
We fully expect that the group of leading companies making a 100% renewable electricity commitment through RE100 will keep growing over the coming years – and we are excited about the businesses we’ll be working with in the future.
We also expect to see more companies setting their first renewable energy target to get them on the pathway to joining RE100 and going 100% renewable. Along with our broader community of partners, we look forward to turbo boosting momentum right across the field.