US-based Corporations Procured 20 GW of Clean Energy in 2022
Amazon leads clean energy procurement, followed by Meta and Google
January 31, 2023
Even as power purchase agreement (PPA) prices increased, corporations in the United States procured nearly 20 GW of clean energy in 2022.
Cumulatively, 326 companies contracted 77.4 GW of clean energy by the end of 2022. Of this, 36 GW is operational, making up 16% of the total operational clean energy capacity in the U.S.
Amazon leads the pack as the largest corporate buyer of clean energy in the U.S. with a contracted capacity of 12.4 GW, followed closely by Meta at 8.7 GW and Google at 6.2 GW.
Image: American Clean Power Association
The findings are part of a report released by the American Clean Power Association highlighting how companies are driving demand for U.S. clean energy and speeding up the transition by purchasing it directly from wind, solar, and energy storage projects.
Around 67% of corporate clean energy contracts are under 100 MW, while 33% are over 100 MW.
The trend has shifted towards larger contracts in recent years, with over half of the contracts signed in 2021 and 2022 being larger than 100 MW.
Commercial and industrial companies have announced 58 GW of clean power contracts, making up 76% of the total contracted capacity.
Meta is the leader in operational clean energy with over 4.8 GW in use, including 3 GW solar and 1.8 GW wind.
With 12.4 GW contracted, Amazon only has 19% operational and was brought online from 2015 to 2022.
Google is close behind, with 2.5 GW of operational clean energy, mostly wind capacity.
Around 271 companies are buying operational clean energy, with 73 companies purchasing 100 MW or more, 15 buying 500 MW or more, and 6 buying over 1 GW.
Wind energy makes up two-thirds of operational clean energy contracted to corporations.
Corporate entities are increasingly interested in solar power, diversifying their clean energy portfolio after years of prioritizing wind. American businesses have contracted 45 GW of large-scale solar power, with 28% operational and the rest under development.
The number of solar procurement announcements rose rapidly from 2017 to 2022, reaching a record high of 14.4 GW in 2022 compared to 576 MW in 2017.
Image: American Clean Power Association
Corporations have been purchasing wind energy, the older clean power technology, since 2010.
They have signed contracts for 28.8 GW of energy from utility-scale, land-based wind projects, with 81% of that capacity currently operating.
Annual wind procurement peaked in 2018 at 5 GW and then decreased by an average of 18% annually through 2021. However, there was a 25% increase in corporate wind procurement in 2022, with 4 GW of new announcements.
Wind makes up 37% of the total clean power capacity contracted by U.S. businesses and 65% of operational capacity.
Currently, no corporations have agreements for offshore wind in the U.S.
Corporate buyers have shown limited interest in wind plus storage projects, which are less common than solar + storage projects.
So far, only 12 corporations have signed contracts for 548 MW from three wind plus storage hybrid projects. Corporations make up 14% of the U.S. wind plus storage project capacity online or under development.
Texas is the top state for clean energy projects contracted by corporate buyers, accounting for 35% of capacity and 20% of projects. Corporations favor Texas-based projects over projects in the state, where only 21% of all clean energy capacity is located.
Corporate buyers have contracted around 107 clean energy projects in Texas with a total capacity of 27 GW.
Illinois ranks second with 32 contracted projects for 5.1 GW.
The overall solar installations across all market segments in the U.S. are likely to triple in size, increasing from 129 GW to 336 GW in the next five years, according to an earlier report published by the Solar Energy Industries Association and Wood Mackenzie.
Wood Mackenzie said in another report that the Inflation Reduction Act will propel annual investment in the country’s renewable energy sector to nearly $114 billion by 2031 from $64 billion in 2022.
The commercial and industrial sector is a major contributor to the growth of solar energy in India. The increasing demand for reliable and cost-effective energy solutions, coupled with government incentives and subsidies, has led to a surge in solar installations in this segment.
According to a Wood Mackenzie report, Indian corporates led renewable procurement market in the Asia Pacific region by procuring 8.1 GW in the first half of 2022.