By Donna Clapp
From the July/August 2023 Issue
The past two years have seen a significant acceleration in annual clean energy investment worldwide, according to the International Energy Agency’s (IEA) report World Energy Investment 2023. The report’s analysis highlights the impact of the volatile fossil fuel markets resulting from the Russian Federation’s invasion of Ukraine, which has expedited the adoption of various clean energy technologies. Improved economics, particularly in the context of high and volatile fossil fuel prices, increased policy support through initiatives like the U.S. Inflation Reduction Act of 2022, and new programs in Europe, Japan, China, and other regions are also factors in this growth. Additionally, the alignment of climate and energy security objectives has played a significant role, particularly in economies that heavily rely on energy imports.
“Solar and wind are leading the rapid expansion of the new global energy economy. This year, the world is set to add a record-breaking amount of renewables to electricity systems—more than the total power capacity of Germany and Spain combined,” said IEA Executive Director Fatih Birol. “The global energy crisis has shown renewables are critical for making energy supplies not just cleaner but also more secure and affordable—and governments are responding with efforts to deploy them faster.”
The IEA estimates approximately USD $2.8 trillion will be invested in the energy sector in 2023. Of this amount, globally more than USD $1.7 trillion will be directed toward clean energy, encompassing renewable power, nuclear energy, grids, storage, low-emission fuels, efficiency enhancements, and end-use renewables and electrification. Presently, for every dollar spent on fossil fuels, USD $1.7 is being invested in clean energy. This represents a notable shift from the 1:1 ratio observed just five years ago.
Global additions of renewable power capacity are expected to jump by one third this year. Solar PV additions will account for two-thirds of this year’s increase in renewable power capacity and are expected to keep growing in 2024. Manufacturing capacity for all solar PV production segments is expected to more than double to 1,000 GW by 2024, led by China and increasing supply diversification in the United States, India, and Europe. Based on those trends, the world will have enough solar PV manufacturing capacity in 2030 to comfortably meet the level of annual demand envisaged in the IEA’s Net Zero Emissions by 2050 Scenario.
Wind power additions are forecast to rebound sharply in 2023, growing by almost 70% year-on-year. The faster growth is mainly due to the completion of projects that had been delayed by Covid-19 restrictions in China and by supply chain issues in Europe and the United States.
Looking for a new location to relocate or expand to that focuses on renewable energy initiatives? Here are several locations making moves toward energy changes.
Big Apple Focused On Wind
In 2021, the New York City Economic Development Corporation (NYCEDC) unveiled the 15-year $191 million Offshore Wind (OSW) NYC Initiative, to establish the region as a frontrunner in the burgeoning OSW industry. This initiative is instrumental in realizing the city’s ambitious climate targets of achieving carbon neutrality by 2050. By 2030, the OSW sector is projected to provide employment opportunities for New Yorkers while fostering a robust supply chain valued at $109 billion for the East Coast region.
It wasn’t long before that initiative landed a project that is helping transform the South Brooklyn Marine Terminal into one of the largest OSW port facilities in the nation. The deal brokered by the NYCEDC in March 2022 involves Equinor, a Norwegian developer, its partner British Petroleum, and Sustainable South Brooklyn Marine Terminal LP (SSBMT). The terminal will become a power interconnection site for the Empire Wind 1 Project, and heavy lift platforms will be built on the 39th Street Pier for wind turbine staging and installation for Equinor and other developers. The port will serve as a hub to support the Empire Wind and Beacon Wind offshore wind farms.
“With this investment, the South Brooklyn Marine Terminal will soon be transformed into one of the largest offshore wind port facilities in the nation,” said Mayor Eric Adams. “This site will be the launch of a whole new industry for New York City that will support 13,000 local jobs over time, generate $1.3 billion in average annual investment citywide, and significantly reduce our carbon footprint so that we can meet our climate goals of 100% clean electricity by 2040. This is a transformative moment for New York City and our clean energy future—a future of sustainable power, good-paying jobs, and climate justice.”
NYCEDC also partnered with Equinor and community resources to support workforce training, with Equinor establishing a $5 million ecosystem fund to bring more New York City residents into offshore wind careers, propel offshore wind innovation, and support a just transition. Finally, Equinor is working to establish an offshore wind learning center—accessible to the community—within its Brooklyn office.
“This agreement marks a major step forward in our commitment to New York State to both provide renewable power and to spark fresh economic activity, while creating enduring jobs,” said President of Equinor Wind U.S. Siri Espedal Kindem. “With the support of NYCEDC, SSBMT, and our partners in the community, Equinor and bp are ready and eager to invest in the revitalization of SBMT—a historic port that will soon become a major part of New York’s energy future. New York has shown unflagging determination to become a focal point of the region’s offshore wind industry, and this agreement offers tangible evidence that this vision is quickly coming to life.”
New York City’s goal is to have 70% of its energy consumption come from renewable sources by 2030. Under the Climate Leadership and Community Protection Act, New York State has set goals of securing 70% of the state’s electricity from renewable energy by 2030 and the installation of nine gigawatts of offshore wind by 2035. Equinor and bp have contracts for three offshore wind projects in New York—totaling more than 3,000 megawatts of clean, renewable energy.
“New York City and New York State are places that are leading the charge in terms of policies that are accelerating decarbonization, and doubling down on our commitment to protect the planet against climate change,” said Jonathan Lane, NYCEDC’s Vice President of Initiatives. “That policy is not just itself nation leading, through our public procurement power, as well as all of the private investment that we know is going to go into the green transition, there are few places that are better positioned to lead from the front than New York City. If you are in the climate, technology, and renewable energy space, there are few better markets than New York City to make that happen because everything is a superlative in New York, whether it’s the size of the government budget or the amount of private investment and capital that exists to drive decarbonization efforts.”
Florida Cashes In On Sunshine State Status
Net zero has been a goal for energy companies, corporations, and states for several years now but last year, Florida Power & Light’s (FPL) parent company NextEra Energy became the first company to announce it has a Real Zero goal. That means by 2045, NextEra Energy and FPL will be 100% carbon emissions free. So, the company is now leading the decarbonization of the U.S. economy and is looking to help commercial and industrial customers reach their own Net Zero or Real Zero commitments.
“Our Real Zero goal to eliminate carbon emissions from our operations is a real goal that would make a significant difference for our customers,” said John Ketchum, President and Chief Executive Officer, NextEra Energy, “We are building on our decades of innovation and investments in low-cost renewable energy to decarbonize our company while keeping bills affordable for our customers. Attaining Real Zero will be one of those achievements that provides lasting value to our customers and the communities where we do business. We’ve been working on this for a long time and will take our extensive experience, industry-leading development platform, and scale to help accelerate the decarbonization of the U.S. economy.”
FPL, the largest electric utility in the nation, serving over 12 million Floridians, plays a pivotal role in NextEra Energy’s plan to eliminate carbon emissions. Over the past two decades, FPL has made strides in reducing its carbon footprint, achieving a 40% improvement in its carbon-emissions rate. Today, FPL’s emissions profile stands at 28% below the national average. During this time, FPL has phased out the use of foreign oil and shut down all its coal plants in Florida.
Under the Real Zero initiative, FPL is committed to accelerating the transformation of its energy generation mix. The company has set interim targets to achieve a decarbonization rate of 36% by 2025, 52% by 2030, 62% by 2035, and 83% by 2040, ultimately reaching the milestone of 100% decarbonization by no later than 2045. FPL intends to accomplish these goals by modernizing its generation fleet in Florida, incorporating an array of sustainable sources such as solar, battery storage, existing nuclear power, green hydrogen, and other renewable energy options.
Expanding its solar energy program is a significant facet of FPL’s Real Zero strategy. FPL already boasts the nation’s largest solar energy program and currently operates over 60 solar energy centers across the state.
With a vision to install 30 million panels by 2025, FPL’s solar capacity is set to undergo a substantial expansion. Presently, FPL generates nearly 4,000 megawatts (MW) of solar power from approximately 15 million solar panels. By 2045, FPL aims to augment its solar capacity exponentially, surpassing 90,000 MW and deploying hundreds of millions of solar panels within its system.
FPL unveiled the Manatee Energy Storage Center in December 2021. This facility stands as the world’s largest solar-powered battery storage installation. Equipped with cutting-edge battery systems, it can power the equivalent of 329,000 homes for over two hours, enabling customers to enjoy the benefits of solar energy even during nighttime or adverse weather conditions. By implementing additional battery storage solutions, FPL ensures a continuous supply of energy when the sun is not shining.
As part of the Real Zero initiative, FPL is set to enhance its grid with over 50,000 MW of battery storage, a significant increase from the current capacity of 500 MW. This expanded energy storage infrastructure will play a crucial role in harnessing solar power and delivering it during periods of high demand, such as evenings when many customers return home.
“In addition to the current volatility in energy prices, the costs of renewable energy have fallen in recent years, making it much more cost competitive,” said Cathy Chambers, Economic Development Director at FPL. “Also, companies are looking to take advantage of incentives and tax breaks at the federal and local levels. We work with companies to help find their ideal location in Florida. From large industrial users in manufacturing or logistics to smaller operations, FPL offers programs that help companies meet their sustainability goals.”
Puerto Rico: Renewable Energy Evolution
In the midst of its commitment to a sustainable future, the U.S. territory Puerto Rico has set its sights on the goal of achieving 100% renewable energy by 2050. One crucial aspect of this transformative journey is the procurement of 3,750 MW of renewable energy generation through Power Purchase Agreements (PPAs). This initiative is not only driving utility-scale project developers and financing parties to engage with Puerto Rico, but it is also reshaping the way renewable energy is embraced on the island.
To foster the widespread adoption of renewable energy, the Puerto Rican government has established a progressive framework that expedites interconnection terms and offers a generous net metering program. By virtue of legislation, the activation of net metering is being implemented, resulting in approximately 3,500 new installations every month. Additionally, Governor Pedro Pierluisi’s administration has launched incentive programs to facilitate access to renewable energy, further catalyzing the installation of a significant number of renewable energy systems.
“Because of the nature of the energy challenges in Puerto Rico, there is also a prime opportunity for companies engaged in R&D, pilots, and commercialization of energy technologies to grow in Puerto Rico with the goal of exporting their expertise to other markets around the U.S., the Caribbean, and the world,” said Francisco Berríos-Portela, P.E., Chief of Staff for Energy Affairs. “Not only will they have access to the local market, which is clamoring for better energy solutions (and has experience implementing them), but they will have a great launchpad to export from. This positions Puerto Rico for a leadership role in energy solution development.”
On a distributed scale, Puerto Rico has a high rate of residential solar adoption and the private sector, particularly in manufacturing, and is familiar with microgrid and on-site energy solutions. Historic challenges with the grid have encouraged 50% of the manufacturing economy to have on-site energy, like cogeneration. These innovative approaches not only enhance electrical quality and reduce costs but also shield businesses from the financial ramifications of power outages, while simultaneously improving overall efficiency and environmental cleanliness. Many of these distributed energy systems are coupled with solar and battery storage, forging a resilient and sustainable energy ecosystem. As a result, energy solution providers on the commercial and industrial scales can access a large market demanding their products and services.
One example is Freewind Energy, founded in 2021, the first manufacturer of wind generators in Puerto Rico. Its primary goal is to provide energy solutions to those affected by frequent blackouts in the Caribbean. The mission is clear—to mitigate the detrimental effects of these outages, which can lead to business interruptions, equipment damage, and a diminished quality of life for the residents. Freewind’s Battery Management System allows users to monitor energy generation and usage, ensuring a consistent power supply even during storms or hurricanes. The system utilizes a free and renewable fuel source (wind) for customers to experience significant long-term savings, especially considering the high energy prices in the Caribbean. Freewind’s Battery Management System offers flexibility by allowing users to utilize various fuel sources such as solar, wind, diesel, grid-tie, etc., ensuring uninterrupted power delivery and reducing business risks.
“We chose Puerto Rico for three reasons,” said Taylor Tondelli, Chief Operating Officer of Freewind Energy. “First, the island has an ongoing energy crisis and is in dire need of solutions especially in post-disaster scenarios. Second, the wind conditions are perfect for generating high amounts of energy, and third, the economic development department [Invest Puerto Rico] offers many incentives for new manufacturing operations. Freewind Energy has a renewable energy solution specifically designed to help other businesses. Our vertical-axis wind turbines generate enough power to cover the needs of small and medium businesses and can be scaled up to generate utility-grade power. While there are many great solutions for residential energy needs, Freewind fills the gap of energy needs for the high-consuming client, such as a manufacturer, hotels, or office buildings that rely on a steady flow of energy to run their operations.”
Alberta: Amazon’s First Renewable Energy Project In Canada
Alberta is a leader in Canada for energy decarbonization, having made strides in reducing the carbon intensity of its electricity grid as well as its oil and gas sector. This is being achieved through a series of targeted reductions, a transition away from coal, and the development of world-scale renewable energy projects.
“The Canadian government made a commitment to phase out coal back in 2015,” said Stacie Lara, Director of Investment, Energy for Invest Alberta. “So, there was an announcement made then that we would phase out coal power generation by 2030. Coal power generation has since fallen from 38% usage down to 7% at the end of 2022, and we will be fully transitioned off coal by the end of this year. Alberta is the leading jurisdiction in Canada for renewable energy. So back in 2022, we received 75% of all the renewables investment in Canada, and we will have more installed capacity than any other province by 2025. It’s just really incredible to see how this investment is flooding into Alberta.”
Alberta’s market-based grid and unique geography make it an attractive setting for utility-scale wind and solar projects which allows companies to purchase renewable electricity at a competitive rate. It comes as no surprise then that Alberta caught the attention of industry giant Amazon, which chose the province as the home for its inaugural renewable energy endeavor in Canada, marking a significant milestone in the country’s clean energy landscape in 2021.
Energy-Forward Site Selection
The topic of energy comes up early and often as companies work to make site selection decisions regarding existing and future facilities. Read more…
Amazon’s first renewable energy investment in Canada is an 80 MW solar project in the County of Newell in Alberta. Once complete, it will produce over 195,000 megawatt-hours (MWh) of renewable energy to the grid—which is enough energy to power more than 18,000 Canadian homes for a year.
Investing in renewable energy is one of the many actions Amazon is taking as part of The Climate Pledge, a commitment to be net-zero carbon by 2040, 10 years ahead of the Paris Agreement.
“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 CEO. “With these nine new wind and solar projects, we have announced 206 renewable wind and solar projects worldwide, and 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.”
