“Corporate teams will need to talk about the effect of their procurement strategy on the ground”
What do you think is the main trend that will impact renewable energy procurement in 2023?
I see the first key trend as a move towards accountability and transparency. People want to know what kind of climate and social impact renewable energy is having. For example, corporates have the opportunity when buying electricity to reduce carbon emission but also to drive economic growth all around the world. Corporate teams will need to talk about the effect of their procurement strategy on the ground, they will need to talk about a chain of accountability that goes right through the whole system.
“People want to know what kind of impact renewable energy is having”
Do you see a potential for risk in the renewable energy sector similar to what is happening in the offset sector for example, where credibility is challenged?
Absolutely and that is part of that accountability trend I mentioned. Those who are buying renewable energy need to be totally transparent about how they are purchasing it, what is the certification process,. Certifications are great and they are needed, but that rubber stamp is no longer enough. People want to lift the hood and see what’s underneath.
“People want to lift the hood and see what’s underneath.”
What other change do you see in the renewable energy sector in the next year?
Another big trend we’re going to see is the huge electricity growth in emerging markets. We’re going to see companies extending what they’ve achieved in their own markets, in the US and Europe, to emerging markets.
Imagine you’re sitting on a ski lift with the CEO of a sports gear company who knows little about energy, what advice would you give him?
I’ll tell him that no matter what sector or country he works in, how he sources his renewable energy is really important. He will be held accountable for this electricity use and provenance, by his employers, his customers and his stakeholders. I would point out to him that there are many options and solutions available, like for example the one Powertrust is offering. Overall, he needs to get on board with what lots of companies are doing, which is to increase the proportion of his electricity coming from renewable sources, and communicate that in a very transparent way.
“No matter what sector or country a CEO is working in, how he sources his renewable energy is really important”.
Many people see Net Zero as an emissions’ game, thinking about reducing emissions and buying offsets. Do you think CEOs have electricity top of mind?
Once you’re at the offset stage, you’ve already passed a couple of preliminary steps which maybe you should have addressed first, in your plan to reach Net Zero. The first stage is to address energy efficiency, only consuming the electricity that you absolutely need to. But there is a second stage companies can and should do, which is to use renewable energy as much as is feasible to do so. The more renewable energy they can buy, the less offsets they’ll have to buy.
Increasing the share of renewable energy not only helps a company to reach Net Zero by directly reducing emissions, but it’s an opportunity to leverage their spend where there is a lot of impact – carbon impact but also social impact.
“Increasing the share of renewable energy is an opportunity to leverage their spend where there is a lot of impact – carbon impact but also social impact.
How would you explain the Powertrust approach?
Powertrust is an evolution of the way companies have been buying their renewable electricity for 20 years or so. There is a standard method called the power purchase agreement, which we are really building off in a couple of different ways. We’re making these long term agreements for electricity accessible to new parts of the world, in emerging markets. We’re also making these agreements accessible to a new type of company. It’s no longer just the largest companies in the world that are able to purchase renewables in this way, but also the small and medium size businesses.
“It’s no longer just the largest companies in the world that are able to purchase renewables in this way, but also the small and medium size businesses.”