Pilita Clark for the Financial Times:

When General Motors buys electricity for the Texas plant that makes hundreds of its Chevrolet and Cadillac trucks each day, it normally does a deal with a local power utility lasting at most a couple of years.

But five months ago the US carmaker did something very different, signing a 14-year agreement with a wind farm company, EDP Renewables North America, for enough electricity to make more than half the trucks it produces each year.

The deal makes GM one of a fast-growing number of big US companies buying green power to cut their emissions of carbon dioxide, and potentially make savings on their energy bills. In doing so, these groups are reshaping the way renewable energy is purchased, and helping green power generators build more projects than they otherwise might have done.

Some businesses still find it difficult to do deals to invest in renewable energy, and an initiative backed by 60 companies including Facebook and Microsoft was launched on Thursday to make it easier.

Silicon Valley technology companies led by Google were the first in the US to plough into green energy in a significant way, but now the trend has spread to some of the country’s biggest manufacturers and retailers, including GM, Lockheed Martin, Amazon and Walmart.

In total, 24 large US companies bought 3.6 gigawatts of power in 2015 and the first quarter of this year — more than three times the amount purchased by seven groups in 2014, according to the Rocky Mountain Institute, a US non-profit organisation trying to accelerate these renewable energy agreements.

“The growth was spectacular and took everybody by surprise, nobody expected that,” says Hervé Touati, a Rocky Mountain Institute managing director.

The long-term power-purchasing agreements that big companies are signing with wind and solar farms are important for renewable-energy generators trying to build new projects.

By guaranteeing future revenues, the purchasing deals help bolster the generators’ efforts to persuade lenders or investors to finance projects that might otherwise fail to get off the drawing board.

Until now, wind and solar farm developers have typically sold most of their electricity to big state or privately owned utilities that in turn sell it on to their customers.

But this is now changing. Along with universities and cities, big companies are making so many long-term power-purchasing deals with renewable-energy generators that in 2015 they for the first time outstripped utilities doing such agreements in the US.

According to the American Wind Energy Association, the new class of buyers accounted for 52 per cent of wind generating capacity sold via power-purchasing agreements last year, up from 23 per cent in 2014 and 5 per cent in 2013.

Full article ($): Big US companies spearhead renewable energy drive

