AEE Report: Six Policies to Expand Corporate Access to Advanced Energy

U.S. corporations contracted for 3.1 gigawatts (GW) of renewable energy in 2015—double the amount procured by corporate purchasers the previous year, based on the findings of a study released on August 9 by the Washington, DC-based Advanced Energy Economy Institute.

Conducted on behalf of the institute by Meister Consultants Group, the report – Opportunities to Increase Corporate Access to Advanced Energy: A National Brief – focuses on six policies that would enable companies to purchase advanced energy.

“Providing opportunities for companies to access advanced energy is a win-win for states,” said Graham Richard, CEO of Advanced Energy Economy, a national business organization, with which the AEE Institute is affiliated. “Adopting policies like those outlined in this report signal to companies that the state is open for business. That will unleash private investment in new energy infrastructure and drive economic growth in the state.”

To put the market potential for corporate advanced energy purchases into perspective, the report states, if half of the electricity demand from commercial and industrial customers nationally were met by renewable energy, this would drive development of nearly 450 gigawatts (GW) of renewable energy—more than double current capacity nationwide, and enough to power over 100 million houses.

However, in many states, the researchers found, companies are restricted in their options to make these purchases. The report outlines six policies for advanced energy, identifying the states with the largest corporate demand and strongest renewable resources in which the policies could expand options for corporate consumers.

Three of these policies enable companies to purchase electricity from large-scale offsite advanced energy projects:

• Utility Renewable Energy Tariffs, through which companies can purchase renewable energy competitively sourced by their utility,
• “Back-to-Back” Utility PPAs, in which the utility acts as an intermediary between a customer and a renewable energy developer, and
• Direct Access Tariffs, which allow certain customers in traditionally regulated markets to choose their electricity source. These policies open up purchasing options generally not available to companies located in vertically integrated states.

Three other policies identified by the researchers allow companies to access energy from distributed energy resources:

• Raising System Size Limits for programs that credit distributed generation, such as net metering,
• Allowing Third-Party Ownership of onsite generation systems, and
• Permitting Virtual or Aggregated Metering, to enable companies to benefit from distributed energy, even when their needs are not met by a single onsite system at a single building.

While most states around the country currently have policies in place that support onsite or distributed advanced energy, not all of them are structured to enable the participation of larger corporate users, and these three policies can enable companies in particular to benefit from distributed resources.

After considering states’ regulatory and political environments, 11 states stood out for one or more of the policies: Alabama, California, Florida, Georgia, Indiana, Kentucky, Michigan, Minnesota, North Carolina, Ohio, and Texas.

Applicable policy options for each state can be found in the Executive Summary of the report.