Nucor, a steel production company, has announced the signing of a 15-year Virtual Power Purchase Agreement (VPPA) for 250 megawatts of solar energy in Texas.
The project is expected to begin delivering clean electricity in Q2 2023. The agreement marks the first solar power purchase agreement for Nucor and the largest of its kind for the steel industry.
Construction is expected to commence in Summer 2022, creating hundreds of construction-related jobs during its peak. The local community will benefit over its operating life through land lease, tax, and other payments. The expected electricity generated at full capacity is enough to meet the consumption of nearly 50,000 average Texas homes.
VPPAs have become an increasingly mainstream way to secure renewable energy for corporations. In September, Henkel, a German chemical and consumer goods company, signed a large-scale virtual power purchase agreement (VPPA) relating to a new wind farm in Bee County, Texas, which will cover 100% of the electricity demand of Henkel’s operations in the US.
In order to reach its goal to source 100% renewable electricity for its production sites by 2030, Henkel follows a combination of on-site production of green energy, direct purchase, and virtual coverage. This involves, for example, entering into long-term VPPAs that feed power from specific renewable energy plants into the supply grid — in an amount that is equal to the amount consumed. Thus, Henkel contributes to creating additional renewable energy generation capacity by way of its green power purchase.