300 companies chart path for CO2-free energy technology

By Peter Behr | 11/29/2021 07:11 AM EST

"H2" labeling at a hydrogen pumping station.

Large corporations like Google are outlining a new strategy for emerging clean energy technologies like hydrogen and carbon capture. Labeling at a hydrogen pumping station is pictured. Sean Gallup/Getty Images

More than a decade ago, a host of U.S. companies helped drive down wind and solar energy costs through voluntary energy purchases, a trend that’s reshaped the nation’s power sector.

Now, a coalition of nearly 300 major corporations and institutions is urging those same companies to give similar treatment to much-needed next-generation clean energy technologies like long-term batteries, hydropower and geothermal energy.

“We don’t just want solar. We don’t just want wind,” said Caroline Golin, Google’s global lead for energy policy and market development. “We want you to come to us with a full stack of carbon-free energy. How the technologies work is really going to be up to the supplier.”

Google is part of the Clean Energy Buyers Alliance (CEBA), which along with White House officials and the Clean Air Task Force is endorsing what they called a pivotal shift in voluntary corporate energy purchases on a webinar this month.

Without upfront backing from companies and government agencies, the higher costs of nascent clean energy options risk delaying or defeating their widespread availability a decade or more from now, according to a new Google-funded study by Princeton University researchers that was reviewed at the webinar.

The alliance, whose members also include Microsoft Corp., Walmart Inc., Amazon.com Inc. and General Motors Co., is specifically seeking to channel financial support to clean energy options such as long-term batteries, geothermal energy, hydrogen fuels, hydropower installations on existing dams, CO2 capture from gas-fired power plants and new nuclear reactor projects to help jump-start these technologies.

“If proactive investment in advanced technologies is not made soon, it is highly likely that these resources will not be prepared to scale when needed to ensure reliability and affordability and reach 100% carbon-free grids,” the report concluded.

According to studies by Princeton researchers and other analysts, a huge ramp-up in wind and solar power and infrastructure in this decade could bring the share of clean power in the U.S. to roughly 70 percent. Although details are debated, going beyond that level, while ensuring grid reliability during extreme weather events, will require backup by “firm” zero-carbon power sources that are available when needed around the clock, these studies report (Energywire, Sept. 20).

CEBA, which was formed as the Renewable Energy Buyers Association, renamed itself as a “clean energy” organization this month to reflect the expanded strategy.

U.S. companies were early buyers of wind and large-scale solar power when those sources were considered costly and risky, CEBA Chief Executive Miranda Ballentine said. Over the past 15 years, business and industry have been catalysts for the addition of over 42,000 megawatts of new renewable power in the U.S., and so far this year they have been responsible for 40 percent of new renewables additions, she added.

In the current procurement practice, a company will match its annual energy needs with a renewable power purchase commitment. The Princeton study reported that when wind and solar power aren’t available at the hours or days when needed, corporate buyers must find other sources — typically natural gas — and the hoped-for reduction in greenhouse gas emissions the companies were seeking isn’t realized.

“During times when the wind isn’t strong or the sun doesn’t shine, voluntary buyers still have to rely on carbon-emitting power plants like natural gas or coal-fired generators,” said Princeton assistant professor Jesse Jenkins, who led the report project.

The next frontier in clean energy procurement is matching a company buyer’s electricity demand, hour by hour year-round, with carbon-free electricity generation from within the same electricity region as the buyer’s facility. The new solution is called 24/7 carbon-free procurement, with companies lining up a portfolio of clean energy sources, including variable wind and solar and “firm” sources that aren’t dependent on sunshine or wind.

A model is a first-of-a-kind contract between Google and energy supplier AES Corp. announced in May, Jenkins said. AES has committed to meet the entire requirements for Google’s data centers in Virginia with electricity that is 90 percent carbon-free every hour. AES will supply the power from a 500-megawatt portfolio of wind, solar, hydro and battery storage resources.

Google has also signed purchasing contracts with startup Fervo Energy, which is adapting oil and gas fracking methods to the production of geothermal energy to generate power (Climatewire, Sept. 26, 2018).

The strategic shift at Google followed a disappointing analysis of its renewable energy purchases, Golin said.

“While we put a lot of new renewable energy on the grid, we haven’t taken off a lot of the dirty energy that was there, and that was really difficult for us to swallow,” she told webinar participants.

“We also realized that we were not having the broader economic systemic impact we were going for,” Golin added. That led to the new goal of acquiring portfolios of variable and firm zero-carbon electricity sources that would hit zero-carbon targets around the clock, she said.

At the same time, companies, foundations and high-wealth investors are backing new zero-carbon technologies. “We can get pretty far in the technologies that exist today. … We have to start investing in those next-generation technologies to get the last 20 percent,” Golin said, naming advanced nuclear, new storage technologies and other candidates.

The study last week, which used a complex electricity planning model from Princeton and Massachusetts Institute of Technology researchers, assessed the effect on carbon emissions in California and the PJM Interconnection grid of switching to an around-the-clock clean energy procurement rather than contracts for annual totals. The 24/7 carbon-free electricity strategy produces deeper emission reductions and clean energy transformation, but at a potentially significant cost premium for first movers.

To make the new 24/7 procurement approach work, new buying strategies will be needed, such as group buying by coalitions of companies, Golin said.

“Our economic systems and our grid are really built for the past. If we want to achieve this [decarbonization] goal, we won’t be able to do it unless our policy systems change” and energy markets reward carbon-free power for the value of the damage to life and property they avoid, Golin said at the webinar.

That means federal regulations on clean energy goals, major investment in transmission, direct federal investment in commercializing next-generation technology, changes in energy markets, and new clean energy purchasing opportunities for corporate buyers, she added in an email. But the two parties in Congress are nowhere close to agreement on transformational clean energy goals.

“In theory, the government should be mandating 100 percent clean energy. We’re not there for a variety of reasons,” Armond Cohen, executive director of the Clean Air Task Force, said during the webinar. “So, the corporate leadership is really important.

“Maybe it shouldn’t be that way,” he said. “But in a lot of areas it’s the corporates that are leading on this.”

This story also appears in Climatewire.