In a race to carbon neutrality, corporate PPA purchases have skyrocketed in the past few years. Despite COVID-19’s upheaval, 2020 saw a record 23.7 GW of PPA contracts signed — 18% above the prior year. And in 2021, 31.1 GW was purchased, once again setting a new record. While the PPA market is highly diverse — including technology, oil and gas, automotive, telecommunication, retail, and fast-food firms — a few standout players lead the world in clean energy capacity.
Amazon is the largest corporate PPA holder globally, with more than 8,000 megawatts of installed renewable energy. Central investment locations include the U.S., Canada, the UK, Sweden, and Spain. Most of the electricity sourced through PPAs is fed to the company’s corporate offices, Whole Foods Market stores, Amazon Web Services (AWS) data centres, and fulfilment centres. The company has only occupied this number one spot since 2020, at which time it surpassed Google as the largest procurer of corporate clean energy.
“Amazon continues to scale up its investments in renewable energy as part of its effort to meet The Climate Pledge, our commitment to be net-zero carbon by 2040,” said Jeff Bezos, Amazon founder and former CEO. “With [our company’s wind and solar projects] we are now the largest corporate buyer of renewable energy in Europe and globally. Many parts of our business are already operating on renewable energy, and we expect to power all of Amazon with renewable energy by 2025 — five years ahead of our original target of 2030.
Despite the company’s pledges and sizeable renewable energy portfolio, its emissions have continually risen since it first disclosed its carbon footprint in 2018. Amid a surge in e-commerce in 2020, Amazon reported a whopping 15% annual increase in total emissions — demonstrating the importance of further investment in PPAs, energy efficiency initiatives, and electrification of transit en masse.
Well known for its sustainability initiatives, Google comes in a close second behind Amazon’s corporate PPA capacity. With more than 6300 megawatts of renewable energy installed, carbon offsets targeting natural gas, active exploration into nature-based climate solutions, and a commitment to no longer create artificial intelligence solutions for oil and gas exploration, Google has set “a new high-bar for the [technology] sector” with its ambition, according to Greenpeace.
Pichai Sundararajan, the CEO of Alphabet Inc. and its subsidiary Google said [the company’s] pledge to use only carbon-free energy by 2030 was its “biggest sustainability moonshot yet. We’ll do things like pairing wind and solar power sources together and increasing our use of battery storage. And we’re working on ways to apply AI [artificial intelligence] to optimize our electricity demand and forecasting,” he said.
According to Google Sustainability, “[the company] has had great success securing significant amounts of renewable energy at rates that are competitive with non-renewable sources, proving that [businesses] can do great things for the planet and support the bottom line.”
Rounding out the top three is Meta — formerly known as Facebook — with more than 5800 megawatts of installed PPA capacity.
Since 2018, the company claims to have reduced its greenhouse gas emissions by 94%, making possible its broader goal of net-zero emissions across its supply chain by 2030. One of the strengths of Facebook’s approach to corporate sustainability has been its simultaneous focus on all three scopes of corporate emissions – rather than simply procuring renewable energy through PPAs, which only addresses one scope (albeit a critical one).
“The biggest lever is to design and build some of the world’s most energy-efficient data centres,” said Facebook’s chief technology officer, Mike Schroepfer. “But we’ve also become one of the world’s largest buyers of renewable energy.”
The company’s data centres are cooled using functions that require less water and electricity, meaning non-computing energy use is kept to a minimum (10%).
Despite the race to net zero representing positive competition for some of the world’s largest brands, criticism remains prevalent. For Facebook, this primarily comes from proven accusations that the platform helped promote climate-change-denying advertisements for monetary gain.
The first company on this list that’s not a technology company is Total Energies, which deals in natural gas, petroleum products, and renewable energy. An active supporter of carbon pricing, Total Energies has committed to spending 10% of the company’s R&D budget on carbon utilization and storage technologies. Additionally, it will allocate 60 billion dollars to renewable energy projects by 2030 to continue adding to its more than 4300 megawatts of PPA capacity. This in turn demonstrates a marginal sustainability effort for a fossil fuel company.
While a founding member of the Oil and Gas Climate Initiative (OGCI) – an organization that seeks to implement solutions to reduce greenhouse gas emissions – much of the company’s commitments rely on undeveloped carbon capture technologies. Additionally, the company describes natural gas as a transitional energy source – and has only committed to ending flaring by 2030.
Last on our list is telecommunications company AT&T, with 2800+ megawatts of installed PPA capacity. According to John Stankey, CEO of AT&T, addressing climate change through renewable energy purchases and other sustainability initiatives is part of the company’s plan to ensure customer satisfaction with its services. “Our network is tested by climate change and natural disasters every year. We recognize the long-term impact this commitment can have, and we owe it to the millions of customers who rely on our services to create the most resilient and sustainable business we can.”
The company has committed to achieving net-zero scope one and two emissions by 2035. However, AT&T has allowed its suppliers to set their own “science-based” targets by 2024, meaning there is still significant improvement – particularly on scope three emissions – to be had in AT&T’s corporate sustainability plan.
While PPA purchases demonstrate concrete – and easily trackable – commitments to addressing anthropogenic climate change, other corporate sustainability policies are often unclear, hard to measure, or difficult to understand. Because of this, environmentalists and consumer advocacy groups have sought greater transparency and standardization in recent years – and a report by the New Climate Institute and Carbon Market Watch suggests they were right to do so.
“Companies’ ambitious-sounding headline claims all too often lack real substance. Even companies that are doing relatively well exaggerate their actions,” said Thomas Day, author of the study.
It’s imperative moving forward that corporate sustainability plans include all downstream and upstream emissions. As we’ve said before, corporate participation is necessary if the world is to tackle climate change – meaning the race for corporate carbon neutrality must continue to accelerate at a breakneck pace.