Power purchase agreements are on trend. In particular in the US, but increasingly also in Europe, more and more businesses invest into these long-term electricity contracts. In this way, success stories are created which highlight the benefits that PPAs bring in terms of environmental policy and finance.
Among the pioneers is German railway company Deutsche Bahn for example, who have been running trains on green power purchase agreements since 2011. There is also a large number of bestpractice examples from the members of the RE100 initiative. The number of members has grown to 136 businesses since 2014. They all promise to change to 100 per cent energy from renewable sources by 2050 at the latest, some even by 2020. To this end, the majority of members invests in PPAs.
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Power purchase agreements – different ways to achieve a common goal
There is no one-size-fits-all solution when it comes to long-term electricity contracts. Businesses can choose between different PPA versions. The energy sources vary too – be it wind, sun or water. Together with you, we develop the concept that best suits your needs.
Pioneers in Europe
Deutsche Bahn takes the lead when it comes to using renewables. The company concluded its first green PPA as early as 2011 – one of the first in Europe. In this long-term deal, RWE supplies around 900 kilowatt hours of electricity per year from innogy's hydroelectric power stations to Deutsche Bahn. That is the equivalent of eight per cent of the electricity that is needed to run the railways, enough to operate one third of the company's long-distance fleet (ICE high-speed trains and intercity trains) or to supply 250,000 households for one year.
The sleeved PPA is part of Deutsche Bahn's comprehensive climate protection scheme, which the company has redefined in terms of new goals in early 2018. Deutsche Bahn plans to half specific CO2 emissions by 2030. Around 140 million customers on the main line services already travel on 100 per cent green electricity. Deutsche Bahn’s long distance service is thus the first and only mobility company that can bring its customers to their destinations carbon-free.
A PPA project by Deutsche Bahn
Company: Deutsche Bahn
Energy source: Hydropower
Duration: 14 years
Size: 14 hydroelectric power stations
Total output/year: approx. 900 million kilowatts
Special feature: This is enough electricity to run one third of the long distance fleet (ICE high speed trains and intercity trains) for a full year.
The old hand
Google was able to tick the “100 per cent green energy” box as early as 2017. Last year, the internet giant produced three gigawatts of green electricity. That is more than Google needs to cover its own consumption. Over the years, the company has invested three billion US Dollars and further projects are already in the pipeline.
Google also drives the expansion of renewables with numerous power purchase agreements: having signed its first PPA in 2010, Google is an old hand in this business. Up to now, the tech company has either implemented or is still developing 19 PPA projects worldwide – seven of those in Europe alone.
A PPA project by Google
Energy source: Solar farm
Place: Delfzijl, the Netherlands
Duration: 10 years
Size: 123,000 solar panels
Total capacity: 30 megawatts
Special feature: With its size equivalent to that of 65 football pitches, this solar farm is the biggest in the Netherlands. Together with other energy sources from PPAs, it supplies Google’s Eemshaven data centre for example.
Several PPAs in the Netherlands were set up to ensure the supply of Google’s data centre in Eemshaven with electricity. The data centre, which consumes large amounts of energy, has been run on green electricity from day one.
To this end, Google is supplied with power from the largest solar farm in the Netherlands in Delfzijl. The electricity produced in the 30 megawatt plant is transmitted directly to the data centre in Eemshaven for a period of 10 years. In 2014, Google, in collaboration with Eneco had already built a wind farm to supply the data centre. Additional electricity is supplied from two wind farms in Bouwdokken and Krammer.
The independent company
Ikea really means it: sustainability is number one on the agenda of the company’s 2020 strategy. To this end, the furniture giant has invested approximately 1.7 billion euros in renewables since 2009. The outcome: 750,000 installed solar panels on sites with Ikea buildings and 415 offsite wind turbines world-wide. This means that Ikea owns more wind turbines than stores. They are also a founding member of the RE100 initiative.
One vision drives the people at Ikea more than any other; be completely self-sufficient in terms of its energy supply by 2020. According to Steve Howard, Chief Sustainability Officer at Ikea, the furniture company has read the signs of the times well: “In the Nordic region we are already completely self-sufficient in terms of our energy supply and we even produce more energy than we consume. We should reach that stage in the US very soon as well. Ikea is partially supplied by electricity from its own plants and has also entered several long-term PPAs”.
A PPA project by Ikea
Energy source: Onshore wind farm
Place: Cameron County, Texas, USA
Duration: 20 years
Size: 55 wind turbines
Total capacity: 165 megawatts
Special feature: Cameron Wind Farm represents Ikea’s largest investment in a single renewable energy project to date.
In 2014, at a time when PPA was still a completely foreign concept to most businesses, Ikea had already entered into a mega deal with two wind farms in one year. With Hoopeston Wind in Illinois und Cameron Wind in Texas, Ikea had 263 megawatts of green electricity at its disposal within a very short period of time. With 55 wind turbines and a capacity of 164 megawatts, Cameron Wind Farm is still Ikea’s largest investment in renewable energy worldwide.
Philips and partners
The team workers
Be climate-neutral by 2020, that is the company target announced by Dutch corporation Philips at the UN Climate Change Conference COP21. This also includes covering their own energy demand with 100 per cent green electricity. Since 2007, Philips has already reduced its CO2 emissions by over 35 per cent. Thanks to the PPA deal, Philips’ Dutch sites already use 100 per cent renewable energy.
Philips’ PPA collaboration project
Companies: Philips, Akzo Nobel, Google and DSM
Energy source: Two onshore wind farms
Place: Bouwdokken and Krammer, the Netherlands
Commissioned: 2018 and 2019
Size: 9 and 34 wind turbines
Total capacity: 34 and 102 megawatts
Special feature: The partner concept of this PPA, with four multinationals as power consumers, is unique within the Netherlands and very innovative, even in a global context.
Achieving more together: four multinationals decided to invest in green energy together in 2016/2017. This led to the construction of two onshore wind farms in the South-West Netherlands. The energy output at almost 140 megawatts in total, is split equally between the four companies, Philips, DSM, Akzo Nobel and Google.
Some of them are active in very different industry sectors. What brought them together as partners is their geographic proximity: Philips and the two chemical companies DSM and Akzo Nobel are all headquartered in the Netherlands. Google uses the green energy from the PPA to run one of its energy intensive data centres in the Dutch seaport of Eemshaven.