That’s the key finding of Power Forward: Why the World’s Largest Companies are Investing in Renewable Energy, a new report released this week by Ceres, Calvert Investments and World Wildlife Fund. By analyzing corporate sustainability commitments and conducting dozens of executive interviews, the groups found that a majority of the world’s largest companies – 60 percent of the combined Fortune 100 and Global 100 – have a renewable energy goal, a greenhouse gas reduction goal or both.
In short, a majority of the world’s largest companies are investing in clean energy and reducing emissions. And in contrast to gridlock in Congress and little progress from UN climate negotiations in Doha, the message is clear: Corporations understand that clean energy is good business.
Why are corporations using renewable energy? Again and again, they told us it comes down to economics. Large companies need ways to limit their exposure to volatile fossil fuel prices, which affect the price of electricity. They understand that coal-fired power is increasingly risky and the current glut of cheap natural gas simply can’t last. As Duke Energy CEO Jim Rogers once put it, “Ben Franklin said there are two certainties in life: death and taxes. To that, I would add the price volatility of natural gas.” Because wind and solar fuel is free, renewable energy offers a way for corporations to control their energy costs over time.
Ceres believes that renewable energy should power any 21st century business, and we think the bar can — and should — be set even higher. Two years ago, Ceres released The 21st Century Corporation: The Ceres Roadmap for Sustainability, which calls for companies to reduce GHG emissions by 25 percent and obtain at least 30 percent of energy from renewable sources by 2020. These are ambitious goals, but our grid can support more renewable power, climate science requires it, and companies are shifting resources toward it.
Roughly two-thirds of the members of Ceres Company Network have in place targets to reduce GHG emissions, increase renewable energy production and procurement or both. Ceres member company Sprint Nextel, for example, aims to secure 10 percent of its energy from renewable sources by 2017. General Motors plans to double its solar power capacity and build up 125 megawatts of renewable energy capacity worldwide by 2020.
Looking beyond the Fortune 100 companies covered in Power Forward, there are even more examples of renewable-powered corporate leadership. Ceres member EMC has set a goal to source 50 percent of its global facilities' electricity consumption from renewables by 2040, while Timberland is on pace to obtain at least 30 percent renewable energy by 2015, doubling its current share of renewable power. CA Technologies aims to source 25 percent renewable energy by 2015, putting it ahead of the Ceres Roadmap timeline.
Even with these pockets of progress, companies must do more, and strong policies may be the best catalyst. Businesses are pushing for action in Washington through groups like Ceres’s own BICEP, Business for Innovative Climate and Energy Policy. Earlier this year, 19 large corporations, including Pitney Bowes, Yahoo!, Sprint and members of BICEP wrote a letter to Congress in support of the Production Tax Credit, a key provision for the wind power industry. Unless Congress acts to extend it, the PTC will expire on January 1, which will immediate raise renewable power costs stemming from newly built projects.
Power Forward recommends that policymakers immediately extend policies like the PTC that encourage new renewable power development. It also asks them to support renewable energy portfolio standards and to allow companies to enter into Power Purchase Agreements with renewable energy developers, which help corporations meet their renewable energy goals and are essential to helping wind and solar developers secure financing.
Skeptics can continue dismiss clean energy as a far-off dream. But – as this report shows – they’d be dead wrong. Among the world’s largest companies, we now know that a commitment to clean energy is fast becoming the rule, not the exception.
