Dive Brief:
- The trend of utilities offering green tariffs so large customers can purchase renewable energy has remade the map of states with the highest relative amounts of corporate clean energy procurement, boosting some states with regulated electricity markets above others with deregulated markets, a new report released by the Retail Industry Leaders Association on Thursday said.
- The report’s rankings of the 50 states shows that from 2017 to 2020, New Mexico and Nevada have leaped ahead of states like New Jersey, California, New York and Texas in terms of renewable generating capacity installed through various forms of procurement, in large part due to green tariffs or direct utility purchases of renewable energy.
- The top spot in the ranking, Corporate Clean Electricity Procurement Index 2020, went to Illinois, the number two state in the 2017 list, due to a strong performance in all three areas of procurement the report examined: utility purchasing including green tariffs, third-party purchasing such as power purchase agreements and onsite or direct employments, such as rooftop solar.
Dive Insight:
The Retail Industry Leaders Association counts among its members many large retailers, such as WalMart and Target, that have made aggressive moves to procure renewable energy.
States with partially or fully deregulated markets have an advantage in the ranking, the report notes, because corporate customers have more choices from which to procure renewables. For example, Texas, a state with full retail electric competition, gets a massive 6% share of its entire electric generating capacity from commercial & industrial power purchase agreements, including PPAs with wind and solar facilities.
But Texas, which came in fifth in the 2017 list, fell to 11th in the 2020 version. That fall does not appear to be due to any failing — the state continued to lead the country in terms of capacity procured through PPAs, and had five times as much deployment of offsite renewable energy projects that are directly owned by companies as it did in 2017.
Rather, other states moved faster toward more procurement. New Mexico jumped 22 places to second on the list, while Nevada rose from number 13 in the 2017 list to number four on the 2020 list. For New Mexico, that growth came from 400 MW of capacity procured through a green tariff program launched in 2016 or direct purchases from utilities, and for Nevada it came from 500 MW of green tariff or direct utility purchases, according to the report.
Utah also made a big jump, moving from number 22 in 2017 to number nine in 2020. Its earliest green tariff program came in 2015, according to the report. “Though Utah does not have [a renewable portfolio standard] and is not part of an ISO/RTO market, the state does have more than 330 MW of green tariff or direct utility purchase deals,” it said.
Overall, since 2017, utility purchasing increased almost four times to 4.3 GW, while offsite PPAs increased from 4.8 GW to 16.6 GW and onsite deployment went up from 0.8 GW to 5.5 GW.
“States with deregulated electric markets are no longer the only ones that offer at least some of their customers the ability to purchase RE,” the report said. “The proliferation of states that offer green tariffs — now at 17 states with new-build green tariffs approved or proposed, up from five states in the last Index — means that more customers now have the option to purchase RE through their utility.”
By region, the Northeast showed the strongest presence in clean procurement capacity, with all nine Northeast states landing in the top half.
