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Clean Energy Deal Tracker

Q4 2020: Amazon, AT&T, McDonald's and Starbucks lead the way as clean energy procurement matures

It was a lockbuster fourth quarter, with more than 7.3 gigawatts of contracts inked — more than any other single quarter since the start of the GreenBiz deal tracker. 

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After a strange year, corporate renewable procurement deals ended on a high note, with corporations inking some of the biggest, most complex transactions to date. The result was a blockbuster fourth quarter, with more than 7.3 gigawatts of contracts inked — more than any other single quarter since the start of the GreenBiz deal tracker

The list includes familiar names: Amazon; Google; Starbuck; AT&T; McDonald’s among them. These corporations continued to innovate, inking bigger, more complicated and more holistic energy deals. The roster also included some fresh faces, including Crown and Kimberly-Clark. 

Amazon inks largest renewable energy deal to date

Web giant Amazon inked what it calls the largest corporate procurement deal to date: 3.4 GW spread over 26 projects across eight countries and four continents. Prior to this announcement, the largest comparable deal was Google’s 1.6 GW deal in September 2019. At the time, I called that jaw-dropping. Amazon just raised the bar substantially. 

Among the dozens of projects within the deal is Europe’s largest offshore wind corporate power purchase agreement (PPA), according to the developer, Orsted. The offshore wind project is planned to be 900 megawatts, 250 MW of which Amazon will procure. Last quarter, Orsted inked what it called the largest corporate PPA from a single project: 920 MW of offshore wind in Taiwan.

Amazon says it has overtaken Google as the largest corporate user of renewables, and the renewable procurement projects are in service of its climate pledge to reach net-zero carbon by 2040. 

This deal also highlights how corporate climate trailblazers are bundling deals to make more of a splash. While the capacity procured here is huge, the average size per project is 130 MW — impressive, but not enough to get headlines on its own. The same could be said of Google’s announcement in 2019, which comprised 18 deals, meaning each averages at about 90 MW per project.

Q4 2020 Clean Energy Deal Tracker





AT&T, Honda are lead offtakers in largest single U.S. solar development

Corporations Honda, AT&T, McDonald's, Google and Home Depot partnered with three Texas municipalities (Bryan, Denton and Garland) to be the offtakers in a massive 1.3 GW solar development. Developer Invenergy says, when complete, it will be the largest solar development in the United States. 

AT&T is slated to take 500 MW, bringing the telecommunications company’s total procurements to more than 1.5 GW of capacity. Honda is the second largest offtaker, earmarking 200 MW, followed by McDonald’s with 160 MW. 

The deal is an example of an aggregation project, where offtakers jointly shoulder the negotiations, risk and paperwork to streamline the offtake process. The model was spearheaded by Bloomberg, Cox, Gap Inc., Salesforce, Workday and developer BayWa r.e. at the start of 2019. At the time, the structure was unprecedented and inspired webcasts and case studies as others wondered if it could open up procurement opportunities to more types of companies. (The project came online last quarter.)

While this new deal doesn’t include any companies new to the renewable procurement game, it reflects how the aggregation model can scale; this solar development is 10 times the size of the BayWa r.e. project. 

Starbucks takes a holistic approach to procurements

Starbucks announced its sustainability goals for 2030, which the company says puts it in line with becoming a "resource positive company." The initiatives include components to address its carbon, water and waste. 

Its fourth-quarter clean power announcement included four new investments in renewable energy, each using a different procurement strategy: 

  • A supply chain virtual power purchase agreement (VPPA) — a first for the company — in a move to reduce its Scope 3 emissions 
  • Investments in 23 community solar projects in New York state to supply solar to its stores and the community 
  • A VPPA and a virtual storage agreement (VSA) to provide energy to stories in California 
  • An investment in a wind project in Washington state to power stores and the company’s roasting plant

Starbucks does not provide a total procurement figure for the four investments. But the move reflects a trend noted in the Q3 2020 tracker: Corporations are beginning to think about renewable energy within their larger sustainability initiatives. 

Notable mentions

  • McDonald’s inked a deal for two wind farms and a portfolio of solar projects with a collective capacity of 1.13 GW. This massive deal is almost three times the size of the fast-food giant’s debut procurements in Q4 2019, and it is in service of its broader climate and sustainability goals. 
  • Two steel manufacturers made this quarter’s tracker: Evraz North America and Nucor Corporation. The procurement reflects the move for heavy industry to decarbonize on the eve of the Biden administration, which indicated decarbonizing steel as a climate priority. 
  • Microsoft inked a tiny but important deal: its first peace renewable energy credit (P-REC), a clean energy deal with co-benefits that support the local community. The deal will directly finance the installation of streetlights in a recently electrified neighborhood in the Congo — and clears the way for more deals to consider energy access in their procurements. The move is in line with a trend identified in Q3 2020, where companies are embedding social and environmental benefits into the renewable energy procurement process. The P-REC was executed with Energy Peace Partners, a VERGE Clean Energy Equity Showcase honoree.
  • Home improvement giants made a strong showing this quarter, with Home Depot inking two deals (one an aggregation deal for 50 MW, the other a solar plus energy storage PPA for 75 MW) and Lowe’s inking a 250 MW solar deal. My hot take: The two are battling it out for the perception of climate leadership, and I am 100 percent here for this rivalry. 

Correction: This article was updated on January 14, 2020, to correct the total procurements to date from AT&T. An earlier version quoted 3.9 GW, which is the total procurements of developer Invernergy. AT&T has procured 1.5 GW. 

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