According to a report released on January 16 by the Wind Energy Foundation (WEF), U.S. corporations have committed to signing deals resulting in 60 GW of renewable energy capacity being added to the grid in coming years. However, transmission planners are not accounting for this large uptick of potential near-term procurement.
Large U.S. businesses — including Fortune 500 companies — are increasingly acting on their publicly announced renewable energy goals as new utility-scale wind and solar energy projects are now often the lowest cost power available. According to the WEF report, a coalition of more than 100 corporate entities set a goal of purchasing 60 GW of renewable energy by 2025. The report estimates that the coalition still has some 51 GW left to purchase in order to meet that goal, and questions whether current transmission plans can accommodate the increase in demand.
“This report demonstrates that there is an immediate need for transmission planners to account for the significant renewable energy goals of corporate purchasers,” said John Kostyack, executive director, WEF. “As costs continue to decline for new utility-scale wind and solar projects, an ever-increasing number of large corporate buyers are acting to lock in low-cost renewable power purchase agreements.”
The WEF report looked at a range of different scenarios, and found that existing and planned transmission facilities may not be sufficient to deliver the amount of renewable energy companies have already committed to buying. For example, using a conservative set of transmission-building assumptions, the report found that planned transmission build-outs would meet only 42 percent of corporate renewable energy demand in a high-procurement scenario, or 78 percent of the demand in a low-procurement scenario.
“GM’s ability to access renewable energy is key to our decisions about where to expand new facilities,” said Rob Threlkeld, global manager of renewable energy at General Motors. “It’s essential that transmission planners take the growing corporate demand for renewables into account in the planning process. Expanding and upgrading transmission is critical in helping GM access low-cost renewable energy and meet our commitments.”
Given these findings, the report recommends that corporate buyers and other large institutional customers take the following actions:
- Encourage transmission planners and state Public Service Commissions to increase access to affordable, renewable energy by approving upgrades and expansion to transmission lines.
- Participate in regional and inter-regional transmission planning conversations to ensure future transmission infrastructure meets customer demand for renewable energy.
- Urge the Federal Energy Regulatory Commission to continue to work to improve the interregional planning process, consistent with Order 1000.
“Any company aiming to buy renewable energy should engage in the transmission planning process,” said David Gardiner, president of David Gardiner and Associates, which produced the report on behalf of WEF. “Access to the lowest-cost renewable resources depends on transmission, and corporate renewable energy buyers need to communicate their procurement goals to transmission planners.”