Energy Aggregation Brings Renewable Energy To More Companies

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Power purchase agreements are wonderful for large energy consumers like Google, Facebook, and Apple, which can sign up with a renewable energy developer to take all or a major portion of the electricity produced by a solar or wind farm. But smaller companies are often unable to get the same access to renewables because they simply don’t need as much electricity. They might be able to use 5, 10, or 20% of a solar or wind farm’s output, which is not enough to get the attention of renewable energy developers.

renewable energy aggregator
Credit: LevelTen Energy

LevelTen Energy, based in Seattle, has the answer — energy aggregation. It is “sort of like a matchmaking service,” CEO Bryce Smith tells Fast Company. LevelTen finds companies that want to purchase renewable energy and connects them with renewable energy suppliers. By aggregating the needs of several small companies, it can allow them to access PPA agreements that are usually reserved for high demand customers.

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In North Carolina, Bloomberg, Cox, Workday, The Gap, and Salesforce have used LevelTen’s services to enter into a PPA with solar developer BayWa RE. Representatives of the 5 companies met an a conference sponsored by the Rocky Mountain Institute in 2017 and decided to investigate ways of accessing renewable energy. That interest led them to LevelTen, which put them together with BayWa RE. The five companies will split the financing costs and energy usage equally among themselves.

“It’s all well and good if Apple and Amazon and Google are buying renewable energy, that helps the market,” Smith says. “But if only those companies are buying, we haven’t come very far.” Big companies have the resources to finance and source large amounts of renewables while local businesses like coffee shops can obtain renewable energy through community solar projects, but small- or mid-sized companies are often left out. LevelTen’s platform will show them what renewable energy sources are available and match them with other companies looking to aggregate their demand.

Part of what LevelTen does is provide clear information about a renewable development’s financial outlook and investment risk factors. “If you’re setting up purchasing agreements with five companies, then suddenly there are maybe 50 people — executives, sustainability managers, board directors — who have to sign off on it,” Smith says. He believes the LevelTen platform will demystify the risk and financial implications of investing in renewable energy. That will make it more comfortable for small to medium size companies to get involved with renewables.

Michael Barry, the head of sustainable business operations at Bloomberg, tells Energy Digital, “The process of buying renewable energy through a PPA can be difficult and time-consuming, especially for buyers seeking smaller energy loads. Combining our resources as a single group of buyers has enabled us to scale our impact. This transaction is a great example of a group sharing best practices, working together and showing the benefit that cross-firm collaboration can have. It also serves as an example to developers that a market exists for these types of projects.”

Every sales person knows the deal doesn’t get done if the parties don’t understand what they are signing. What LevelTen does is make sure all the questions are answered so the parties are comfortable with the business proposal. Taking away the fear that the buyer is making a mistake is a critical component of any sales transaction. Getting more small- and medium-sized companies familiar with the process of procuring renewable energy is a big step forward for those who want to be part of a sustainable future.

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Steve Hanley

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."

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