May 17, 2017

Catalyzing Campus Clean Energy: How to Get Started

By Edison Energy

First the good news: There are now clean energy options that are financially attractive for most college campuses. Then the bad: Figuring out where to start can be confusing.

Over the past ten years, hundreds of colleges and universities have publicly committed to climate leadership. Many have since conducted greenhouse gas emissions inventories, and charted a course toward carbon neutrality.

Yet, according to a forthcoming report by Edison Energy and the University of New Hampshire, progress on emissions reductions is not on pace to meet these ambitious clean energy goals. Why not?

Simply put, energy efficiency alone will never bring a campus to zero emissions. Efficiency is an ongoing commitment. Campus facilities and energy professionals are always chipping away at energy consumption. Some have been doing a great job of it for decades. Many are adopting new best practices to manage campus energy: audits, commissioning, demand response, and many other practical solutions.

But campuses also grow, adding to their footprint with new buildings. Plus, building occupants are constantly finding new ways to consume energy.

So even when progress is made on efficiency, reducing “energy use intensity,” total campus consumption still might stay flat, or decline only modestly. With few exceptions, these gains are too little and too slow to meet looming carbon neutrality goals.

Why is that important? Because purchased electricity is the number one source of emissions for many campuses. Moreover, it is one of the largest areas of non-discretionary spend. So, yes, it makes sense to focus on reducing electricity demand and we need to do a lot more of that.

But if efficiency alone is not enough to meet clean energy goals, then what will?

That’s easy. Switch the source of electricity from fossil to renewable. But renewable energy is complicated, uncharted territory for most campus decision-makers, representing a completely new way of procuring energy. Maybe it is not so easy after all.

This is where the good news comes in. More than one hundred campuses have switched part of their supply by installing onsite solar arrays. This is a good start. Using solar power purchase agreements, campuses can lock in a competitive, fixed price for their solar power over 15 to 25 years.

However, onsite solar is limited to the sites available for hosting solar arrays. That means most campuses can only supply a small fraction of their electricity need with onsite solar systems. Moreover, in some states, the economics of solar are underpinned by granting the environmental claims to someone else. The campus might get a good price on electricity, and a snazzy looking solar array that is marvelous for telling the campus sustainability story, but it does not get to deduct any greenhouse gas emissions from its inventory.

Understanding environmental claims is one of the complications with renewable energy. That’s another post unto itself. Suffice to say, onsite solar can be very good but, like efficiency, it is only part of the total solution.

The most promising new clean energy strategy is sourcing large-scale, offsite renewable power purchase agreements (PPAs). To date, only a dozen or so campuses have successfully executed these kinds of big deals, but the rewards have been impressive: energy budget certainty over a long period of time, lower energy costs, and big slices out of the carbon footprint, not to mention bragging rights. And, more importantly, they can deliver educational opportunities for students and faculty.

The benefits of large, offsite deals are compelling. But they are also the most complicated solution. I know from personal experience because I spearheaded the effort for my campus when I was the Director of Sustainability at American University. It took us years to get it done. In the end, we estimated the transaction would save us about $11 million over 20 years, and cut our electricity emissions in half.

And the offsite market has just evolved in a manner that may greatly expand higher educations’ opportunities.

PowerBloks™ PPAs are a proprietary PPA structure developed by Edison Energy that divide large-scale renewables projects into 10 MW, 10-year contracts with fixed, flat pricing, renewable energy certificates, and full additionality benefits.

I learned a lot along the way, which I enjoy sharing by helping other campuses find, structure, and transact these exciting renewable energy deals.

Learn more about Edison Energy’s renewable energy advisory capabilities here.

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