Friday 4th November marks the beginning of the historic Paris Agreement to limit emissions of greenhouse gases (GHG) on a global level. This means that all countries must now begin to implement the plan laid out in their ‘Intended Nationally Determined Contributions’ (INDCs), including regular reporting on efforts to reduce emissions.
INDCs provide clearer direction as to how governments will limit levels of dangerous climate change and renewable energy will play a crucial role in helping countries meet the challenging targets they have set themselves.
Businesses will need to take action to ensure their strategies are aligned to the INDCs laid out by the countries they operate in. Increasingly businesses are responding positively to the climate change agenda driven by the Paris Agreement, government policy and stakeholder interest. This has been evidenced through our research into the sustainability performance of the FTSE 100. We found that:
There is no one reason why there has been such a significant uptake of renewable energy in the past 12 months, but there are a number of influencing factors.
However, switching to renewable energy and proving the validity of a renewable tariff can present a few challenges. Companies are demanding more and more transparency over the source of the renewable electricity they purchase, with the large companies sometimes unable to provide the necessary information.
When businesses buy renewable energy from electricity suppliers, in effect it takes the form of a ‘bundled’ package of electrons and green energy certificates. However, tracking the renewable energy back to its source is not always straight forward, and the buyer has no control over which renewable projects the certificates are purchased from. This can make transparency for auditors and proof of good quality renewable procurement difficult.
Unbundling energy procurement helps companies to source their energy from the grid, and purchase their renewable energy certificates from the market. Creating a verifiable renewable energy package that is superior to a bundled package at the same or better pricing.
Guarantee of Origins (GOs), Renewable Energy Guarantees of Origins (REGOs) and Renewable Energy Certificates (RECs) are all types of attributable tracking certificate. These certificates provide the necessary tool to prove the quality and source of your renewable energy.
By purchasing GOs, REGOs or RECs you are able to choose the location, technology and quality of the renewable energy projects you would like to support, whether that be solar, onshore/offshore wind, tidal or hydro power.
Finally, by purchasing certificates, you are actively helping to increase the financial viability of renewable energy projects, allowing more clean-power producers to enter the marketplace.
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