Four Renewable Energy Procurement Models for Corporate Success

Introduction:
Renewable energy adoption is becoming a corporate imperative, but navigating procurement models can be complex. The U.S. Environmental Protection Agency (EPA) has outlined four key renewable energy procurement methods that corporations can use to achieve their sustainability and energy goals.

1. Unbundled Renewable Energy Certificates (RECs):
RECs provide companies with carbon offset credits without requiring direct electricity from renewable sources.

• How It Works: For every megawatt-hour consumed, companies purchase RECs,     representing the environmental attributes of renewable energy.
• Pros: Simple and flexible.
• Cons: RECs do not include the actual electricity and may be seen as less     impactful by stakeholders.

2. Bundled Green Power Products:
Utilities offer a combined package of electricity and RECs.

• How It Works: Companies pay for green power products that ensure both carbon     offsets and renewable electricity.
• Pros: Easy to implement and credible.
• Cons: Can be more expensive than traditional energy contracts.

3. Corporate Power Purchase Agreements (PPAs):
PPAs allow companies to contract directly with renewable energy producers for long-term supply.

• How It Works: A corporation enters a fixed-price contract with a renewable energy     generator, ensuring a consistent energy supply and price.
• Pros: Provides energy cost stability and contributes directly to sustainability     goals.
• Cons: Requires negotiation expertise and may involve risks tied to project     performance.

4. On-Site Renewable Energy Generation:
Companies can install renewable energy systems, such as solar panels, on their facilities.

• How It Works: Corporations invest in their own energy generation systems, often     using solar or wind technologies.
• Pros: Offers full control and long-term savings.
• Cons: High upfront costs and potential site limitations.

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Conclusion:
Each procurement model has its own advantages and challenges. By understanding these methods, corporations can tailor their strategies to meet operational, financial, and sustainability goals. Whether through PPAs, RECs, or on-site generation, adopting renewable energy is a powerful step toward a sustainable future.

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