Corporate and other non-utility purchasers increasingly want to power their operations using wind energy. Wind’s low costs and stable prices make sense for their bottom line and its clean electricity helps Fortune 500 companies and cities meet sustainability goals. With most wind projects located in rural areas, these customers are not only purchasing renewable energy, they’re also supporting jobs and economic investment in rural communities.
A Growing Demand Market
Over 100 companies, including Walmart, Anheuser-Busch, and General Motors, have committed to 100 percent renewable energy targets. Wind has become the go-to choice for many of these businesses to meet that mark. For example, Google recently announced that it achieved its 100 percent renewable energy goal, and wind supplies 95 percent of that electricity.
Some businesses are choosing to specifically locate new facilities where they can be powered by wind energy, like Facebook’s Los Lunas data center in New Mexico as well as Apple’s newest data center in Iowa.
“Iowa is proud to be the top-ranked state for renewable energy procurement by the nation’s retail and technology industries,” said Iowa Gov. Kim Reynolds. “Access to low-cost renewable energy is a critical part of our economic development strategy. These job-creating businesses cite our access to low-cost renewable energy as a major reason for locating in Iowa.
In announcing plans to build a 400,000 square foot, $1.3 billion data center Apple CEO Tim Cook said Iowa's renewable energy resource was "paramount for us" and "if we couldn’t [procure renewables], we would not be here."
Wind’s costs have fallen by 67 percent since 2009, making it the cheapest source of new electric generating capacity in many parts of the country. And because wind has zero fuel costs, U.S. businesses can purchase wind at a long-term stable price, protecting themselves against future fuel price volatility.
“The U.S. has amazing wind and sun resources that will never run out,” IKEA noted when announcing its investment in the Illinois Hoopeston Wind Project. “We invest in our own renewable energy sources so that we can control our exposure to fluctuating electricity costs.”
“When looking at wind deals, cost savings are one attribute I can bring up when I talk to our finance and accounting department,” said Rob Threlkeld, General Manager of Renewable Energy at General Motors. “Have you ever seen your electric bill go down for multiple years at a time?"
As wind’s costs have come down, interest from corporate buyers has risen, as evident in the chart below.
Source: AWEA, U.S. Wind Industry Annual Market Report
Our new interactive map highlights all of the publicly announced wind deals with non-utility customers at least 20 megawatts (MW) in size.
How to Purchase Wind Energy
For potential customers, there are many ways to buy wind energy. Power purchase agreements (PPA) continue to be the preferred procurement mechanism. 40 percent of the megawatts contracted through PPAs in 2017, or 2,178 MW, were signed by corporate and other non-utility customers, and more than 8,000 MW in PPAs have been signed to date. That’s more than all of the wind capacity installed in Oklahoma, America’s number two wind state.
In addition to PPAs, non-utility purchasers can invest in wind energy in a number of other ways. Methods include wholesale or retail transactions, including utility green tariffs. Customers can also make a direct investment in a wind project or purchase renewable energy credits (REC). AWEA’s Corporate Buyer’s Guide to Wind Energy examines all of these pathways in greater detail.
Municipal Purchasers of Wind Energy
Cities are also purchasing wind energy to meet their sustainability goals and secure long-term price stability. The first wind energy purchase was made by Austin Energy in 1994; since then, there have been over 200 purchases of wind energy made by 100 cities, most through municipal electric utilities. Combined, these purchases total more than 5,800 MW – enough to power 280,000 average homes.
And with over 500 cities making big renewable energy commitments in the past several months, it's clear there is more good news on the way.
AWEA Windy Cities Award
This year, AWEA is launching a new award to recognize cities that have demonstrated a clear commitment to wind energy. The AWEA Windy Cities Award will be given annually to one city or municipal electric utility, and award recipients will be determined based on the following criteria:
Wind Procurement: The extent to which a city purchases wind energy to power its government buildings or larger community footprint. The purchase can be made by the municipal utility, a community choice aggregator (CCA) representing the city, or the city government itself. Eligible procurement methods may include, but are not limited to, signing a physical or virtual power purchase agreement (PPA), enrolling in a utility green tariff program, directly investing in a wind project, or signing a long-term renewable energy credit (REC) contract with a specific wind project.
- Scale: The scale of the wind energy purchase, both in terms of contract term length and size of the agreement.
Governance: The extent to which the wind energy purchase is part of a larger, public renewable energy commitment made by the city.
Information Sharing: The extent to which the wind procurement experience is shared with other cities and the general public in order to encourage similar actions.
Innovation: The extent to which the city uses a new or innovative approach to purchase wind energy.
Replicability: The extent to which the wind procurement can be replicated at the same scale or larger, either by the same city or by a different city.
The Windy Cities Award assessment will be completed by a Selection Committee comprised of AWEA staff and AWEA Electricity Policy & Demand Committee members. As America’s cities continue to move toward affordable, reliable wind energy, those that are doing the most to act on their commitments will be recognized and commended for their efforts.
Wind Works for America's Cities
In June 2017, the American Wind Energy Association released a new brochure, "Wind Works for America's Cities," highlighting some of the many success stories of U.S. cities purchasing wind energy, and explaining how wind purchases work:
Click here to view the brochure.
For more information, contact Hannah Hunt at firstname.lastname@example.org.