July 9, 2020

Spotlight: Corporate Renewable Energy Trends Webinar Recap

By: Grace Morrissey, Senior Analyst, Renewables Advisory

In collaboration with Smart Energy Decisions, Edison sponsored a webinar on July 8th, where we shared major renewable energy buying trends developing in North America and Europe, considering the myriad catalysts and hurdles facing most large energy users today. A commentary on 2020 energy trends would not be complete without a COVID lens, nor without acknowledging the status of US national tax incentives. Below, find a few key takeaways from our discussion on Corporate Renewable Energy Buying Trends Across North America and Europe:

  • Demand for renewables continues to grow, both in the U.S. market and beyond.
    • The U.S. continues to be a dominant market for corporate buyers as they seek to take advantage of projects qualifying for federal tax credits, though markets in Canada, Asia, South America, and Europe are growing – with different contracting options available by market
  • Corporate buyers are shifting from a singular focus on renewable PPAs to developing holistic GHG reduction strategies, employing science based targets and engaging with their supply chains to create a broader impact, considering both upstream and downstream partners.
    • This evolution strengthens long-term relationships across supply chains and upholds mutual commitments to reach shared goals.
  • The industries represented in the market continues to expand, with many new industrial companies pursuing renewables in North America and Europe.  This has led to an increased interest in physically delivered PPAs in the US as many of these companies have large, concentrated deregulated load that is needed for that structure.
  • As the corporate renewable energy market has evolved, so has the commercial structures available to buyers.  Many more industry players are able to wear different risks in the PPA – from market price risk to generation shape risk to others – including banks, retailers, reinsurance companies, and even project owners.  Edison works with clients to find the optimal contract structure and industry counterparties to manage risk most cost-effectively to meet the buyer’s needs.
  • As always, market uncertainty catapults the most attractive projects to the fore. This creates stiffer competition for the most valuable projects available – both from an economic and developmental lens – especially in competitive markets. This requires buyers to move swiftly to lock in the best transactions in competitive markets, and Edison has had success engaging client stakeholders in the process early on in order to be nimble during the selection and contracting process.
  • Considering all of these factors, more clients are bringing Edison into the fold earlier in the strategic process to consider these variables and find solutions that suit their unique needs.

To dive into market specific trends and updates, visit our posts on solar price trends in PJM, the CAISO Market Direct Access Program, and the state of the Mexico market.