What do Apple, Whiteface Mountain Ski Resort, and Central Steel Supply have in common? They all power their businesses using renewable energy. With demands for electric power increasing and the concern for the environment growing, large and small companies in the U.S. are realizing significant business value by cutting emissions and using renewable forms of energy.
Renewable energy refers to electricity supplied from naturally replenished and virtually inexhaustible sources like wind, solar, geothermal, hydro and biomass. These sustainable choices are being used to power businesses of all sizes for maximum benefit.
3 Potential Benefits of Renewable Energy
- Reduced energy costs: On-site renewable power reduces the amount of energy you buy through the local utility, a clean energy installation can lower the delivery costs on your utility bill. ROI is steadily going up as installation costs come down. According to a report by the National Renewable Energy Laboratory, rooftop solar costs have dropped by 54% since 2008. Additionally, federal and local governments recognize the benefits of adopting more renewable energy sources by offering tax credits and incentives to improve payback.
- Hedge price risk: If you install and own your own on-site renewable generation to offset future purchases of electricity from the marketplace, then you are creating long-term protection against potential energy price increases. You can also contract for renewable energy if on-site installation is not an option, and create the same long-term price protection.
- Environmental responsibility: Clean energy plays a vital role in combating climate change and global warming. You’re helping the environment (and your company’s image!) by replacing power traditionally provided by non-renewable sources (such as oil or coal) with a renewable option.
Renewable energy can be a nice complement to your overall business strategy. To secure renewable energy for your organization, you have several options.
3 Ways to Obtain Renewable Energy
- On-site generation: this type of renewable energy takes place at the location where the power is used. Solar panels or geothermal heat pumps are examples of on-site power generation systems. It is common for companies to enter into Purchase Power Agreements (PPA) with third-party developers and operators to avoid upfront capital costs and outsource operating and maintenance responsibility.
- Renewable Energy Certificates (RECs): RECs represent the attribute of energy produced from a renewable energy facility and are used like a “green” currency in the marketplace. RECs allow utilities and end-users to buy and track electricity from renewable sources from the grid as opposed to owning and taking from on-site generation. In this case, you are still purchasing electricity in the market while offsetting the carbon you use, with the environmental attribute.
- Purchase renewable energy from a utility or supplier: electricity suppliers and some utility companies now offer green pricing or green marketing options for users to purchase clean, sustainable energy.
For more information about renewables and how they can fit into your overall energy strategy, contact a Usource advisor today. We can help you assess both benefits and risks, and design a plan tailored for your business.