Corporate Buying of Clean Energy Increased 12% in 2023: BNEF

Amazon was the largest buyer of clean energy at 8.8 GW

February 19, 2024


Corporations announced a record 46 GW of solar and wind contracts in 2023, with a 12% year-over-year (YoY) increase from 41 GW in 2022, according to Bloomberg New Energy Finance’s (BNEF) Corporate Energy Market outlook for the first half of fiscal year 2024.

Companies’ clean energy goals drove these record contracts.

The record increase in contracts was fueled by companies’ commitments to clean energy goals.

In 2023, 45% or 20.9 GW of power purchase agreements (PPA) were announced in the Americas, with Europe following with 33% or 15.4 GW.

“It has never been easier to buy clean energy as a corporation. For the first time, a variety of contracting structures are now widely available around the world to help companies decarbonize their energy consumption. These contracts are now the centerpiece in many companies’ sustainability strategies, rather than a nice-to-have,” said Kyle Harrison, Head of Sustainability Research at BloombergNEF.

Europe most attractive market

From 2022 to 2023, Europe experienced the largest growth by far, with its corporate PPA volumes surging by 74% to 15.4 GW. This was due to supply chain hurdles easing and gas balances normalizing following the region’s 2022 energy crisis, which saw a drop in corporate PPA prices.

This made European markets economically attractive for signing deals. The markets in Germany, Spain, the United Kingdom, and the Netherlands alone made up for over half of the deals announced in the region in 2023.

Corporate power purchase agreement volumes

Unlike Europe, the economics for the signing of PPAs in the U.S. was relatively weaker. Despite remaining the largest market for PPAs with 17.3 GW worth of deals announced, the country saw a 16% YoY decrease from the record 20.6 GW announced in 2022.

This was due to developers being locked into expensive contracts that were signed in prior years and experiencing supply chain bottlenecks. In addition to this, high-interest rates caused the PPA prices in the U.S. to increase by 4% in the first half of 2023.

The power prices did not increase following these rates, resulting in buyers holding off on signing deals until the markets recalibrated.

Amazon led with 8.8 GW

For the fourth consecutive year, Amazon was the largest corporate buyer of clean energy globally. Last year alone, the company entered into PPAs worth 8.8 GW across 16 countries. Amazon’s clean energy portfolio stands at 33.6 GW, which is greater than the power generation fleets of markets like Belgium and Chile.

In India alone, the company operates seven utility-scale renewable energy projects, with the latest addition being announced in Osmanabad, Maharashtra.

Top corporate buyers of clean energy

Among the 200 companies that BNEF tracked, Amazon topped the list, with Meta, LyondellBasell, and Google following closely behind.

“With the rise of artificial intelligence, electrification of transport, and increased need for manufacturing, we expect power demand from the private sector to surge in the coming years. Clean energy, especially through PPAs, will likely be many companies’ first, best option,” added Harrisson.

Tata Power among top five

In 2023, companies inked deals with over 150 developer counterparties. French utility provider Engie, which sold the most clean energy to companies, made 2.4 GW worth of deals through PPAs last year. The company was also the only major developer to sign a solar, onshore, and offshore wind corporate PPA in 2023.

Engie was followed by AES, which announced 1.9 GW of deals.

Tata Power (1.2 GW), Lightsource BP (1 GW), and Eneco (0.9 GW) rounded out the top five developers in 2023, and selling to corporations will continue to be a key strategy for them.

According to Mercom Capital Group’s newly released Annual and Q4 2023 Solar Funding and M&A Report, global corporate funding in the solar sector in 2023, including venture capital investments, public market funding, and debt financing, reached $34.3 billion, a 42% year-over-year increase from $24.1 billion. This was the largest amount raised in over a decade.