Sustainability & Energy Efficiency

Aggregation: Expanding Companies’ Access to Offsite Renewable Energy Projects

3 min read

Seventy-two percent of large U.S. energy users are actively pursuing renewable energy procurement.1 The intensifying prioritization of corporate social responsibility and investments in renewable energy have prompted companies to find new ways to make a more positive impact on the environment.

The options businesses have employed historically to procure renewable energy—such as purchasing renewable energy certificates (RECs) or installing solar panels on business property—while still viable solutions, may not offer the required size to meet businesses’ increasingly aggressive sustainability goals.

Some companies have moved towards another trend in sustainable energy: supporting the development of new offsite renewable projects. At first this may sound daunting, but there are ways to make these projects attainable regardless of your business size. Plus, there are perks that come with investing in a new project.

First, let’s look at the difference between onsite and offsite renewable energy projects.

Onsite vs. Offsite Renewable Generation

Some companies pursue a “behind-the-meter generation system” which is where they produce their own power onsite, primarily via solar panels. The energy generated by an onsite project does not always feed into the local grid, but businesses can generally claim they are supporting renewable energy in some way.

For some businesses, onsite projects aren’t always feasible. Companies may not have the space or capital to pursue a new build on their own, which has led to the huge growth in offsite project options. This is considered a “front of the meter generation system,” and the energy produced from the new renewable project benefits the local grid.

What is “Aggregation?”

When multiple businesses of various sizes use their collective purchasing power to invest in large-scale renewable projects, this is defined as aggregation.

“There has been a historical shift in the demand for renewable energy by corporate America, driven by offsite procurements from the largest power users. In order for this momentum to continue, small- and medium-sized businesses need to join the fold. Aggregation will allow more companies to participate in this renewable revolution and will enable more projects to come to fruition,” says Ben Chadwick, executive director of renewables origination at Constellation.

What Are the Next Steps?

Companies ready to invest in a new build through aggregation have several options for finding other companies to participate in the same project. They can use an advisor to take a deeper dive in finding companies that have similar goals and timelines, or they could leverage connections from industry associations. A third option is using a retail energy supplier and letting the supplier perform the time-consuming work of finding other businesses interested in investing in a new project.

In addition, there are other benefits to working with a retail energy supplier, such as Constellation:

  1. Customers can avoid the complexity of entering into a long-term power purchase agreement directly with a developer by signing up for Constellation’s Offsite Renewable Energy (CORe+) product. Through the CORe+ product, Constellation allows customers to enter into a fixed price contract for the energy the company needs to power its facilities, while also allowing it to support the development of a new renewable project. The cost of the renewable energy is integrated directly into the customer’s retail electric supply bill.
  2. The CORe+ product enables companies to contribute to the development of a large-scale renewable project without taking on all of the energy market variability that can come with alternative structures. This predictability can be a large benefit to customers who would rather focus on running their business than managing wholesale market commodity positions.
  3. A customer gets the benefit of Constellation’s knowledge and access to the wholesale market and risk management capabilities at each step along the way.

Once new renewable projects become reality, businesses will see the rewarding effects, both reputationally and financially, of investing in clean energy and meeting their sustainability goals.

How Your Business Benefits from Contributing to an Offsite Project

  1. Show that you’re committed to improving the environment. By financially supporting the development of a new renewable project, businesses are not only using clean energy to power their facilities, they are helping to deliver renewable energy to the grid, and in some cases, their local grid. Through Constellation’s CORe+ product, customers have access to strong sustainability metrics, which showcase the amount of greenhouse gas emissions reduced via this project.
  2. Obtain renewable energy certificates (RECs). “RECs are issued when one megawatt-hour (MWh) of electricity is generated and delivered to the electricity grid from a renewable energy resource,”2 according to the Environmental Protection Agency. RECs symbolize the environmental benefits of certain actions that have an impact on diminishing greenhouse gas emissions. RECs must be retired in order to claim purchase of renewable power. Learn more about RECS.

A Bonus:

3. Attract millennial employees: Millennials support and want to work for corporate social responsibility-focused companies.3

Through aggregation and the help of a retail energy supplier, businesses, large and small, can invest in an offsite renewable project, allowing them to meet their sustainability goals and prove their commitment to a better environment.



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