How Walmart boosted clean energy policy in Georgia
A contract limitation was limiting municipal utilities' attractiveness to corporate buyers — so they teamed up for market innovation.
Georgia just signed into law a bill that shows the power corporations can have in creating clean energy markets.
Walmart, which has more than 200 locations in Georgia and is striving to be powered by 100 percent (PDF) renewable energy by 2025, worked with bill advocates at the Georgia capital, supporting the legislation in both the House and Senate. And, when the bill was signed into law May 6, Glen Wilkins, a public affairs director at Walmart, appeared at the side of Gov. Brian Kemp.
"Our strategy includes advocating for more widely available, affordable renewable energy for our suppliers and for the communities in which we operate,” said Steve Chriss, director of energy services for Walmart, in an email. “We hope such collaborative efforts will encourage other utilities and state legislatures to play a key role in helping meet our nation's increasing demand for renewable energy."
The one-page bill, SB 95, is simple; it extends the maximum length of solar and wind contracts that rural utilities can enter with their customers from 10 to 20 years. That small change allows the utilities — Electric Cities of Georgia (ECG) — to offer long-term, fixed-price contracts, which are attractive to companies working towards future clean energy goals.
Now, municipal utilities can compete against other energy providers, which were already able to provide longer-term contracts and attract businesses looking for renewable procurement options. That could help grow renewable markets in Georgia’s rural communities where the ECGs operate.
Here are three takeaways from this relatively small clean energy policy win:
1. Corporate renewable energy buyers can drive energy providers to innovate.
Nearly half of the Fortune 500 companies have clean energy purchasing targets. As they work to reach those targets, the backstory of how SB 95 flew through the legislature offers a glimpse into how corporations could influence policy to help energy providers evolve their offerings.
In the case of SB 95, Walmart communicated that clean energy mattered to the company.
"Our use of renewable energy is about more than simply reaching our stated goals," Walmart wrote in a November statement to Patrick Bowie, board member of the Municipal Electric Authority of Georgia. "Renewable energy is a business decision and we balance our desire for renewable energy against our business needs to ensure that we continue to provide everyday low prices to our customers."
Ask and you shall receive. Bowie supported Walmart’s policy push, saying in a statement that his organization is "very focused on meeting the needs of our utility customers."Our use of renewable energy is about more than simply reaching our stated goals.
Walmart is a member of the Renewable Energy Buyers Alliance (REBA), a trade association that pushes for more clean energy options for corporate customers. REBA has an ambitious goal of catalyzing 60 gigawatts of new renewable energy by 2025, and the passage of SB 95 illustrates the type of political weight companies could leverage to open up markets to achieve that.
2. Failure to offer renewable energy options might negatively affect the economics of a region
One concern from the ECGs was if they weren’t able to offer clean energy to corporate customers, companies might seek behind-the-meter renewables or procure energy from another provider. That means the municipal utilities were in jeopardy of losing revenue from large customers.
Last year, for example, Facebook awarded a contract to electric cooperatives in Georgia for more than 200 megawatts of solar power, which is expected to create more than 800 jobs. According to Allie Kelly, executive director of The Ray who worked with bill sponsor Sen. Randy Robertson, ECGs were not able to compete because of Facebook’s long-term contracting requirements — meaning those rural areas didn’t have a shot at the job creation.
"This is an economic development issue that specifically affects rural Georgia," Robertson said by email. "By lifting the regulations on municipalities, we are creating opportunities for job growth and investment in communities that desperately need our help."
As more businesses work to source renewables for their operations, failure to offer the energy of the future could become a liability for towns and communities that can’t offer that option.
3. The partisan divide in Washington on clean energy is not shared in the states
While it's tough for national clean energy legislation to succeed because of the partisan divide, states aren't viewing it in the same way. SB 95’s sponsor, Robertson, is a conservative, and the bill passed unanimously in the Republican-led legislature.
In a statement following the signing of the law, Robertson wrote about the economic imperative of embracing new energy to attract companies.
"Many of the Fortune 500 companies that we already have, and are looking to attract, have requirements for renewable energy in order for them to do business," Robertson said. "SB 95 allows us to attract more jobs and offer more energy choices for our citizens."Many of the Fortune 500 companies that we already have, and are looking to attract, have requirements for renewable energy in order for them to do business.
Georgia has been emerging as a clean energy champion. The state’s solar capacity increased thirteenfold between 2013 and 2017, ranking 11th in solar power states in 2018. In 2015, Georgia added more clean energy jobs than any other state, and the jobs numbers increased through 2017, even as other states’ solar jobs contracted. Several large retailers in Georgia use on-site solar generation, including Anheuser-Busch, General Growth Properties and IKEA.
Notably, Georgia did this without tax credits, a renewable portfolio standard or net-metering legislation. Instead, a conservative on the Public Service Commission, Lauren "Bubba" McDonald Jr., saw the economic opportunity in solar and pushed Georgia Power — the state’s largest utility — to incorporate solar in long-term planning about six years ago. Today, Georgia Power plans to add 1,000 megawatts from renewables while ramping down coal electricity.
Robertson says promoting new markets aligns perfectly with conservative ideals.
"I think this speaks to the commitment of conservatives to smaller government and a healthy business climate," he said in an email. "Perhaps [support from Republicans] is unique to the clean energy transition but it is certainly not unique to the conservative movement and value system."
[Editor's note: This article was updated to include comment from Walmart.]