Beyond renewables: How timing can reduce corporate emissions
There’s a tidal wave sweeping through the clean energy strategies of corporate sustainability efforts: the 100 percent renewable energy target.
Last year, corporate long-term contracts for renewable energy shattered records yet again, with a whopping 13.4 GW, according to Bloomberg New Energy Finance. The RE100 counts 176 companies among its ranks who have set 100 percent renewable targets. Of the top 10 organizations listed in the U.S. EPA’s Green Power Partnership rankings, all of them are buying 96–107 percent of their annual electricity use in green energy. Many more companies are reaching or nearing their 100 percent targets.
So what might be next? Is 100 percent renewable energy the best we can collectively do? Or is there a way for corporations to achieve even deeper reductions in their climate emissions footprint?
There’s good reason to see 100 percent renewable energy as a milestone, rather than the pure endgame:
- Although some corporations have achieved 100 percent renewable energy overall, many of their facilities remain connected to and powered by electricity grids that have a mix of fossil-fueled and renewably generated electricity. This means there are ways to further reduce emissions associated with corporate operations.
- As we add more renewable energy to the grid, it will become likewise more important to aid renewables’ grid integration and avoid unnecessary renewable curtailment, when surplus renewable energy is "wasted" because there’s not enough grid demand to absorb it.
Smarter energy timing adds a powerful new tool alongside traditional corporate clean energy strategies
When it comes to reducing Scope 2 emissions — those associated with purchased energy, which accounts for the lion’s share of corporate electricity use — companies have traditionally had two tools at their disposal: a) invest in renewable energy (add more zero-emissions generation to the grid) and/or b) invest in efficiency (reduce electricity demand on the grid).
These strategies rightfully remain a cornerstone of corporate clean energy investment. But smarter timing of flexible electricity loads — which could range from building HVAC to electric vehicle charging — can and should be another strategy of sustainability teams’ arsenals.
The U.S. power grid is amidst a massive transition from fossil-fueled generation to renewably powered electricity. At any given location within the grid, that electricity’s emissions intensity continuously varies over time, as cleaner and dirtier sources of electricity compete for their place in the dispatch stack and respond to fluctuating demand. This variability is the key to deeper emissions reductions for corporations.
Many electricity loads are flexible, meaning that they don’t have to use energy at an exact time in order to fully deliver their desired end use. For example, an employee’s electric vehicle connected to a level 2 workplace EV charger doesn’t care when the car charges, as long as the battery is full for the drive home. The EV battery could, therefore, modulate its energy demand to sync with moments of cleaner energy and avoid moments of dirtier energy. The same is true for heating and/or cooling office buildings and the charge/discharge cycle of batteries used to reduce commercial demand charges, among many other examples.
The trick is installing the right software to give smart devices the necessary intelligence. For example, WattTime’s Automated Emissions Reduction (AER) is akin to a real-time emissions signal, which allows energy-using devices to know when their electricity is cleaner vs. dirtier, say, or when surplus renewable energy is available on the margin to be absorbed by demand.
For corporate energy managers, tapping into demand flexibility thus can be as simple as a software upgrade on devices that control flexible loads. The end use remains unchanged: EVs get fully charged for employees’ commutes home, office buildings get heated and/or cooled to their target temperatures.
Two ways timing of flexible demand further decarbonizes corporate operations
With this type of intelligence guiding flexible demand, it becomes clearer how the timing of energy use can further decarbonize corporate operations and help companies more fully achieve their renewable energy ambitions and emissions reduction targets. This complements both efficiency, which reduces Scope 2 emissions by using less energy regardless of its emissions intensity, and mechanisms such as renewable energy credits (RECs), which allow corporations to claim zero-emissions clean energy as part of their mix.
For renewable energy integration, flexibility allows corporations to modulate their electricity demand so that the grid can absorb more renewables while avoided some unnecessary curtailment. This is a logical next step beyond additionality, which has to date helped companies focus on seeing that their clean energy investments add more renewable generation to the grid. Now, we can also focus on using that renewable generating capacity better, rather than seeing some of it go to waste at times when there’s not enough grid demand to absorb surplus wind and solar.
This is not necessarily a new idea. This concept already might be familiar to corporate energy managers, who already are accustomed to thinking about their overall load shape as well as the timing of their energy use and the size and peakiness of their demand. Time-of-use (TOU) rates, hefty demand charges for commercial and industrial (C&I) customers and enrollment in demand response programs all have influenced how corporations modulate their electricity demand.
Incorporating a software-automated, continuous intelligence to flexible demand timing simply takes the idea to the next level. It allows corporations to more easily optimize for a variable — emissions — alongside "traditional" variables such as peak demand, energy cost, etc. And it allows them to tap into such capability 24/7/365 with unprecedented granularity (five-minute increments), rather than the select few times per year a commercial demand response program might activate or the relatively blunt TOU rates that might have just three time periods for an entire day.
Even better for sustainability and energy managers, software solutions to flexible energy timing are easy. They’re typically as simple as a basic software upgrade. This is in sharp contrast to the lengthy, complicated negotiations behind renewable energy power purchase agreements and the expensive, invasive upgrades that often go along with energy efficiency investments. Smarter timing for flexible electricity loads may very well be one of the best kinds of low-hanging fruit.