EC urged to prioritise removing corporate PPA barriers

"Getting this right could unlock significant corporate demand for green electricity," members of the RE-source platform wrote to the European Commission to highlight the potential corporate procurement has in helping to achieve the 2030 targets.

The Bassum wind farm is one of the six projects that will supply renewable electricity to Mercedes-Benz in a corporate PPA signed in December (pic: Daimler AG / Windwärts / MarkMülhaus)
The Bassum wind farm is one of the six projects that will supply renewable electricity to Mercedes-Benz in a corporate PPA signed in December (pic: Daimler AG / Windwärts / MarkMülhaus)

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The RE-source platform sent the letter to EC vice-president for the energy union, Maroš Šefcovic, and climate action and energy commissioner, Miguel Arias Cañete.

RE-source is the industry body, which supports sourcing renewable energy for corporations and includes WindEurope, SolarPower Europe, RE100 andWorld Business Council For Sustainable Development (WBCSD).

The letter was also signed by a number of multinational companies and utilites that are either looking to buy renewable energy to power their operations, or provide it, through corporate power purchase agreements (PPAs)

They include: Amazon, Enel Green Power, Facebook, Google, Iberdrola, Microsoft, Ørsted, GE Renewable Energy, Nordex Acciona, EDPR, Innogy, and E.on.

The signatories complained that despite the Renewable Energy Directive which requires member states to "remove existing administrative barriers to the development of corporate renewable PPAs", none of the National Energy and Climate Plans, submitted at the end of 2018, complied with the legislation.

Only two NECPs actually mentioned corporate PPAs.

WindEurope has previously said the draft NECPs were "not meaningful".

In June 2018, the European Parliament, Commission and Council agreed a "binding" 32% by 2030 target for renewable energy usage in the bloc.

Under this ruling, member states were required to submit NECPs to show how they plan to contribute to the aim of increasing renewable energy.

"Corporate renewable energy power purchase agreements can play a decisive role in this regard, increasing the deployment of cost-effective renewable energy to help drive Europe’s energy transition," RE-source wrote in the letter to Šefcovic and Cañete.

Corporate PPAs are already big business in the US, and Europe is starting to catch up, with a number of large deals already in place, particularly in Nordic countries.

Such deals offer strong revenue stability for the generators, and price predictability for the consumers, making it an attractive proposition for both existing projects and new builds in a post-subsidy world.

"We urge you to prioritise the removal of regulatory barriers to corporate renewable PPAs as part of your upcoming recommendations to member states on their draft National Energy and Climate Plans, so that the potential of corporate PPAs can be realised. These recommendations must be clear, actionable, and country-specific," the RE-source letter said.

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