Driving Change: Pathways and Challenges To Decarbonization of Electricity Supply for Large Energy Consumers

Voluntary corporate carbon-free energy (CFE) procurement accounts for over 68 gigawatts (GWs) of the clean energy capacity added to the U.S. grid since 2014, and voluntary purchases are growing by about 20% each year.

Corporate action has an outsized decarbonizing impact—in 2022, renewable energy procurement deals by corporate and institutional customers were 70% of the CFE capacity added to the grid. At the same time, total electric demand from heavy industry, manufacturing, and commercial users is projected to grow exponentially.

This chapter discusses common approaches a company might pursue to decarbonize its power supply. It begins with context for the boom in CFE procurement, discussing the structure of decarbonization goals that drive procurement and regulation of the power grid. It then walks through the basic contract structure and key considerations for such buyers under CFE procurement contracts. Finally, it reviews opportunities for companies interested in deploying CFE resources on-site, contrasting such approaches with procurement contracts.