Global demand for corporate renewable electricity sourcing continues to grow despite COVID-19 pandemic

Corporate renewable electricity sourcing in Europe has shown continuous growth despite the COVID-19 pandemic, demonstrating the resilience and potential of Europe’s renewable energy sector. In November 2020, the cumulative contracted volume of corporate renewable PPAs in Europe reached the 11 GW mark. That’s a significant increase compared to the 2.2 GW of cumulative PPA capacity in 2016.

There is an increasing trend in PPAs signed in Europe annually with a total of 145 PPAs signed in Europe to date. The demand for renewable energies spans across Europe with PPAs signed in as much as 13 different countries: Italy, Poland, France, Denmark, Belgium, Ireland, Germany, the Netherlands, Finland, the U.K., Spain, Sweden and Norway. In terms of project volume, 73% of renewable PPAs signed in Europe source electricity from wind energy.

As of November 2020, this year has seen a record 3 GW of renewable PPAs contracted in Europe. The leading sector in renewable energy procurement in 2020 was pharmaceuticals with 900 MW or nearly a third of new PPA capacity signed.

Newly signed PPAs were not evenly spread across Europe. Spain is leading the table this year with 1.3 GW and accounted for around 70% of new PPAs signed. In terms of technologies, wind energy could not confirm its leading position, as seen in previous years, with only 39% of newly signed PPA volume being wind energy PPAs in 2020. Instead solar PPAs surged to 53% of total PPAs signed this year.

This shows that more and more companies are stepping up to the challenge of reducing carbon emissions with renewable electricity, in line with the EU’s plans for a green economic recovery. With its Green Deal, the EU is aiming to become carbon neutral by 2050. Today businesses account for a significant amount of Europe’s carbon emissions. Corporate renewable PPAs are fast becoming a key driver in transitioning businesses to renewable electricity. As such, these agreements play an instrumental role in meeting Europe’s energy and climate targets.

COVID-19 and its impact on Europe’s economies have not reduced demand for corporate renewable electricity sourcing. Companies from various sectors have committed to ambitious climate pledges. Take Novartis, the first pharmaceutical company set to achieve 100% renewable electricity through virtual PPAs; IKEA, which has committed to becoming climate positive by 2030; or market-leading IT companies that have committed to use 100% carbon-free energy 24/7.

This year has seen more European companies considering corporate renewable PPAs as a competitive form of electricity sourcing than ever before, with a record 3 GW of PPA capacity signed. But regulatory bottlenecks remain. With the assistance of a wide range of experts and business leaders, the RE-Source Platform is asking policymakers to facilitate PPAs in Europe by:

  • Constructing a European regulatory framework fit for the future for PPAs at EU level and removing barriers at EU and national level to ensure the growth of corporate renewable energy PPAs in Europe;
  • Improving the safeguards for the implementation of enabling frameworks for corporate renewable energy PPAs in the National Energy and Climate Plans;
  • Ensuring a robust system for certification and tracking of renewable-based electricity to increase investment, transparency levels and the information contained in guarantees of origin.

Source: RE-Source