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Why Companies Are Buying Renewable Energy
Posted by Matthew McLaughlin on Aug 29, 2017 10:00:00 AM
Corporate organizations are among the biggest buyers of renewable energy. According to PricewaterhouseCoopers’ June 2016 survey, an estimated 72 percent of companies are actively buying renewable energy. The survey also found that around 63 percent of companies “have become more inclined to purchase in the last six months.” Approximately 85 percent of companies that made a previous acquisition planned to increase their renewable energy purchases in the following 18 months.
Buying renewable energy offers several business benefits. First, renewable energy helps businesses reduce their consumption of resources such as fossil fuels and water. As a result, they may see savings on utility bills. Second, renewable energy lowers companies’ greenhouse gas (GHG) emissions. This can provide a reputational boost as consumers and other stakeholders recognize them as businesses that are concerned with the community’s wellbeing. Third, buying renewable energy enables companies to stimulate the economy. In 2016, the World Bank claimed that every USD1 million invested in the US wind and solar energy sectors yields about 13.5 jobs. In addition, every USD1 million spent on energy efficiency retrofit projects generates 16.7 jobs. More new jobs translate to higher consumer spending, which is beneficial to businesses.
Renewable Energy: A Response to Changes in the Economy and Government Policy
Developments in the economy and government policy are driving companies to buy renewable energy:
- Growing Electricity Demand
- Fluctuating Fossil Fuel Prices
- Lucrative Financial Incentives
- Growing Stakeholder Pressure
How Companies Buy Renewable Energy
Companies buy renewable energy through various methods:
- Green Tags
- Onsite Renewable Energy Systems
- Power Purchase Agreement
Future Trends in Renewable Energy Purchases
As individuals and organizations become increasingly aware of the benefits of renewable energy, new trends are emerging:
- Entire Countries Shift to Renewable Energy
- Affordable Renewable Energy is Available for Low-Income Communities
- The Energy Storage Market Grows
Buying Renewable Energy Benefits All Sectors of Society
Companies buy renewable energy primarily because it benefits their business, but in turn, it can have a positive impact on society as a whole. Renewable energy safeguards companies against fluctuating oil and electricity supplies and prices, and helps them reduce their resource consumption. Further, buying renewable energy establishes companies’ reputations as institutions that care for the public welfare.
As other sectors of society start buying renewable energy, other benefits of renewable energy will become more pronounced. For governments, buying renewable energy can help reduce pollution. For communities, buying renewable energy can eliminate poverty and inequality. When all sectors of society are involved in buying renewable energy, its potential and impacts are maximized.
ADEC Innovations is a leading provider of ESG solutions, including fully-integrated industry expertise, software solutions and data management. We help you navigate the energy landscape now and prepare for what lies ahead, so you have greater knowledge on where to invest your limited capital resources.