When Richard and Carson Harkrader first heard that 696 acres of North Carolina farmland had come up for sale, in 2016, one feature of the rolling landscape particularly caught their attention: the power lines that sliced across it as though someone had dog-eared its map. Hard up against the Virginia border, it was a pretty spot—pretty enough that a home builder would eventually take a quarter of the acres for a lakefront subdivision. But for the Harkraders, father-and-daughter operators of Carolina Solar Energy, an independent developer of solar-energy projects, the prettiest thing of all were those heavy-duty transmission lines that arced to the northwest, lacing into the PJM Interconnection, the giant electric grid that dominates the mid-Atlantic.
“It was kind of a gold rush,” the elder Harkrader says one morning this summer, standing amid the hundreds of thousands of glistening black panels, now known as Hawtree Creek Solar Farm, that follow the curve of the hills and tower over our heads. By midmorning the panels are sending 34 megawatts out to the grid, about the same as 10,000 backyard generators buzzing at once. By noon, it’s 65 megawatts—the maximum the grid will take. “I still think it’s magic,” Harkrader says. “Take sunlight and … boom!” Except the only noise is the occasional creaking of their steel frames, as small motors tilt the panels to follow the arc of the sun across the Carolina sky.
About 200 miles north, in Virginia, are the eager buyers of that electric gold: the mega-technology companies, like Amazon, Microsoft, and Google, that operate giant data centers essential to our daily lives, whether we’re ordering on Prime or backing up family photos. Under pressure from customers, employees, and shareholders—and, arguably, out of their own eagerness to reduce emissions—they have been increasingly determined to run these data centers on renewable energy. Once the Harkraders had secured the new solar farm’s preliminary permits and permissions—making a plan to accommodate local deer and joining the crowded “interconnection queue” to plug into the grid—they leased the land to Engie, a French energy giant that builds and operates more than 4,500 megawatts of solar power around the world. And then, before the panels had even arrived on site for installation, Engie in turn struck a deal to sell all the site’s power to a single company: Amazon.
That financial and legal arrangement, known as a PPA (power purchase agreement), has been a crucial force in the U.S.’s transition to clean energy. Of the approximately 235 gigawatts of wind and solar capacity now installed on the nation’s grid, nearly one quarter (more than 52 gigawatts) has been contracted by corporations, mostly over the past decade. That vigorous—and notably voluntary—corporate action has boosted a web of wind and solar manufacturers, developers, and operators. It has made renewables cost-competitive and helped grid operators learn to manage systems with more variability.
As the modern mortgage made the suburbs, the PPA has made the renewables industry. It bridges the economic needs of renewable–energy developers with the climate goals of corporate executives and shareholders. Solar panels and wind turbines are expensive to build but cheap to operate, given that their fuel—sunlight and fresh air—are free. By guaranteeing the electricity will be sold long before it’s been generated, a PPA gives banks confidence to front the money for construction—especially when there’s a giant corporation guaranteeing the deal. In the way that power grids work, all that electricity isn’t wired directly to these companies’ facilities, but adds more juice to each region as a whole. But the way that PPAs work means the companies can legitimately argue that these giant renewable projects wouldn’t have happened without them. PPAs stitch together developers like the Harkraders, energy operators like Engie, electric grids like PJM, and—above all—the large companies hungry for power from renewable sources.
They also set up the biggest corporate power purchase of all: Amazon has leveraged that ecosystem to go on the largest ever solar and wind shopping spree, buying 15.7 gigawatts globally over the past three years, nearly equal to the prodigious energy demands of the $1.4-trillion company. Like an early shopper on Black Friday, Amazon’s fervor has been felt across the industry—while also giving a glimpse of the incredible growth still to come, with the arrival of $369 billion in federal funds provided by the Inflation Reduction Act (IRA). Understanding this key driver of the past decade of solar and wind development helps us see what is likely to happen next: an unprecedented boom in renewable energy that could form a significant wedge in the broader effort to reduce carbon emissions and limit the warming of the atmosphere.
“If it was a market that only waited till something was built—and then you went out and tried to sell the -electricity—these projects wouldn’t get done,” says Harkrader. “People like Amazon, or Microsoft, Walmart, Target—on and on—are standing up and making this market possible. And it’s exploding.”
These days, Amazon is the hungriest of all. The behemoth was not the first to buy renewable power for its operations, but it is now buying the most. The plans it has announced, globally, amount to the equivalent of around 250 more Hawtree Creeks, and more or less equal to all the solar generation built in the U.S. last year. The buying spree is part of Amazon’s broader effort to reach “net-zero carbon” by 2040—meaning it will eliminate or offset the carbon emissions from all its operations, including trucks, planes, and manufacturing. That won’t be easy. An estimated two-thirds of American households are Amazon Prime members; it is almost impossible to use the internet without accessing an Amazon data center. Since it announced its climate goal in 2019, Amazon’s emissions have grown 40%—as its sales have grown more than 50%. “The path to achieving some of our goals will be long and complex,” acknowledges Kara Hurst, who leads Amazon’s sustainability efforts. But clean electricity is Amazon’s climate bright spot. With today’s technology—and a fat checkbook—the company has nearly eliminated its use of dirty energy, prioritizing the hard realities of glass and steel over tree planting or tricky accounting, building at a scale that rivals that of many countries. Amazon has catapulted itself to the front ranks of corporate buyers, contracting last year for more than double its nearest competitor, Microsoft.
For the past decade, in the absence of major climate legislation and in the face of a complex patchwork of regulations that limited the ability of utility companies to build renewable power, PPAs have done the job. But the IRA—the most substantial piece of climate-focused legislation the U.S. has seen—takes that progress and adds billions of dollars in federal incentives. “It supercharges both the role and the potential for customers to drive even more of this,” says Bryn Baker, senior director at the Clean Energy Buyers Association. The latest predictions are gargantuan. Solar developers expect to install more than 215 gigawatts of capacity over the next five years—40% more than was expected before the IRA, according to a report from the Solar Energy Industries Association and Wood Mackenzie.
But electricity is only one segment of carbon emissions, meaning that alone will not be enough to meet the climate goals set by the Paris Agreement. The hope is that the paths established by renewable energy can be applied to harder-to-decarbonize segments, like electric vehicles and manufacturing. Amazon, for example, has announced plans for 100,000 electric delivery vehicles by 2030. “I think we could see even faster progress on transportation than we’ve seen with clean energy on the grid,” says Bill Weihl, executive director of Climate Voice and a former director of sustainability at Facebook. In corporate renewable power purchasing, we can see the narrow path that will need to be expanded into a highway over the next decade.
For the Harkraders, Hawtree Creek required years of close attention to bring to fruition: attending county planning meetings, mapping wetlands, and exploring an old cemetery that, in the end, couldn’t be moved (the solar panels wrap around it). But for Charlie Daitch, who spearheads Amazon’s renewable-power purchasing, Hawtree was one row on a very tall spreadsheet. “I have a pretty good map in my head of the portfolio—where are we distributed, maybe not each individual project,” Daitch says from the passenger seat of a rented SUV, barreling across North Carolina, on his first visit to the site. “It’s gotten bigger than that.”
When Amazon announced the “Climate Pledge” in 2019, it set its own target for reaching net-zero carbon emissions by 2040, 10 years ahead of the Paris Agreement. Included in that was an earlier goal: to use 100% renewable energy by 2030. For a company like Amazon, which has a sprawling -infrastructure for moving goods around the world, eliminating emissions is a challenge that stretches across the business. Sustainable aviation fuel and heavy-duty electric trucks are still years, if not decades, away from broad adoption. But wind and solar power are ready now. “Renewables is a place we identified where we could go fast to decarbonize our electricity stack,” adds Daitch, a mechanical engineer by training.
Compared with its competitors, Amazon came late to that realization. Walmart announced the first-ever “utility scale” PPA in 2008, with a 153-megawatt wind farm in Texas. At the time, it was a controversial move. “Those early companies that made these commitments did not do so because customers were asking for it,” says Miranda Ballentine, who led Walmart’s sustainability efforts at the time and is now CEO of the Clean Energy Buyers Association. The corporate winds shifted in 2010. That March, Greenpeace called out the technology companies for their energy use. Their report was perfectly timed, coming just days before the first iPad was released—a device that self-evidently depended on the internet behind it. The tech companies went on the defensive. “There is no such thing as a coal-powered data center,” insisted Facebook in a statement. “Every data center plugs into the grid offered by their utility or power provider.” Dirty energy, in other words, wasn’t their problem—it was the grid’s problem.
That half-shrug emoji of an argument didn’t last long. The next year, in a joint statement with Greenpeace, Facebook announced a new “preference” for “clean and renewable” energy. Over the next several years, the other tech giants lined up to follow suit. Putting solar panels on the roof or wind turbines in the parking lot was never going to be enough; data centers require too much energy for that, often hundreds of megawatts each. Power purchase agreements give large corporations a way to use renewable energy without having to wait for utilities. “Large off-site power purchase agreements remain the tool that allows you to move more quickly,” says Erin Decker, a consultant at Schneider Electric, one of the leading clean-energy advisers. Big Tech firms are happy to make long-term deals—especially if they can send out a press release. According to the logic of corporate climate action, if a solar farm is built in the desert, it needs to make a sound.
“When we think about our renewable-energy strategy, we’re like, ‘Well, how can we tell the most credible story to our customers about what we’re doing?’” says Amazon’s Nat Sahlstrom. “We don’t want to be greenwashing. We don’t want to be chasing investments that aren’t really having an impact.”
Most of Amazon’s competitors have already completed the deals that lock them into a decade or more of renewable power. Facebook, now known as Meta, long ago “unfriended coal” and has 7.5 gigawatts of renewables under contract. Google reached 100% renewable electricity in 2017, with over 7 gigawatts procured; its next effort is ensuring its data centers run “24/7” carbon-free, meaning all of its energy all the time comes from renewable sources, rather than, for example, buying excess solar during the day to make up for coal power it needs at night. Apple announced that it had sourced 100% renewable energy for its operations in 2018, with 87% of that in the form of PPAs; the next, far more challenging step is helping its suppliers and manufacturers do the same—a goal it has set for 2030. And Microsoft has nearly 8 gigawatts, 5.8 of which it bought in 2021.
Outside of tech, large companies have more catching up to do. “It’s not just Big Tech companies,” says Tyler Espinoza at 3Degrees, a climate-action consultancy. “You have a broad swath of massive corporations that are willing to put their money behind it.” In 2021, Pfizer announced a 15-year contract for 310 megawatts of electricity from a Texas wind farm, enough to power 100% of its North American operations—a gigantic leap from the mere 6% of its global usage previously met by renewables. In August, Ford announced an agreement with a Michigan-based utility for 650 megawatts of solar.
But small and medium-sized businesses struggle with the level of complexity, and commitment, that PPAs require. “The power purchase agreement is a wonderful tool for large, fairly sophisticated, high–creditworthy companies to be able to procure clean energy,” says Ballentine, of the Clean Energy Buyers Association. “It is not as easy of a tool for smaller companies.” As long as there are still large corporations eager to sweep up the available inventory of projects, that hasn’t been a great concern. In the first half of 2022, corporations contracted for 9.8 gigawatts of renewable power in the U.S.—a third of which was Amazon’s.
But across the board, the challenge is coming to terms with how significant the impact of this renewable-energy purchasing can be on the broader effort to counter climate change. Ballentine, who was in the trenches for Walmart’s early actions, sees a single-mindedness in these corporate actions. “The big ‘why’ is very simple,” she says. “It’s about solving the climate crisis. There is no other reason that a company would set a voluntary zero-carbon energy procurement goal or renewable-energy goal.”
Even on a global scale, Amazon’s efforts stand out. The company’s initial Climate Pledge called for 100% renewable energy by 2030. But early in the pandemic, that pace shifted, when Daitch and his colleagues realized they could move much faster than they already were. Yet other aspects of Amazon’s business—like all those trucks and planes—were not going to decarbonize anytime soon.
At the time Amazon had about 1 gigawatt of renewable energy procured. Daitch, who got his start at a traditional energy utility in the Pacific Northwest, working on distribution planning, increased the intensity of his team’s search. Their criteria varied. Wind might work better in Kansas, while solar was preferable in Ohio. Some regions relied heavily on coal power, heightening the impact of any new renewables. But others had crowded—or dysfunctional—processes for connecting new projects to the grid. Generally, Hawtree Creek is emblematic of how the process often works: a local developer who really knows the geography of the state, its electric-transmission network, and the local politics of its counties might respond to Amazon’s solicitation. But once things are under way, they hand the project off to a large energy operator, like Engie.
At the end of 2021, Amazon announced a blockbuster purchase: 18 new projects around the world, bringing its total to 12 gigawatts and making Amazon the largest corporate buyer of renewable energy in the world. In April, it added 3.5 more gigawatts. Amazon’s projects dot the map. In Kansas, two wind farms, both finished in 2021, produce more than 500 megawatts of power. In Halifax County, Virginia, 65 miles west of Hawtree Creek, are four more similarly sized solar farms, totaling 261 megawatts of additional energy. In Ohio, more than 2,000 megawatts have been completed or are coming soon—and on, across 134 utility-scale projects in 15 countries. “There’s a flywheel,” says Daitch. “Our commitment, and signal to the market that we are moving at scale, then gets developers ramped up developing more projects. It gets solar manufacturers investing in more plants and production. So there’s that feedback loop.”
The past year has tested that presumption as the renewables industry struggled with rising prices and constrained supplies. Making matters worse, in April 2022 solar development ground to nearly a complete halt when the Commerce Department announced an investigation into Chinese companies violating tariffs—raising the threat of retroactive import taxes on even the modules that were already in the U.S. Then in June, the situation reversed, when the Biden Administration invoked the Defense Production Act to increase solar production. By the time industry analysts finished calculating the impact of the investment introduced by the IRA, a sense of giddiness settled in among climate activists. According to analysts at Wood Mackenzie, total investment in renewable energy will reach $1.2 trillion by 2035. In a look at the manufacturing of solar polysilicon, the key component in new panels, Bloomberg-NEF found that by 2025 global capacity will be enough to manufacture 940 gigawatts of panels annually—almost as much as the total 971 gigawatts of solar currently installed around the world.
For both corporations and individuals, all this comes back to the broadest goal of reducing emissions sufficiently to counter the effects of climate change. According to an analysis by the International Energy Agency, that means—at least—reaching global net-zero emissions by 2050, on a path that is “narrow but still achievable.” For the past decade, that has looked, frankly, improbable—at least at the pace corporations were going. With the IRA, the U.S. now has a chance.
Blum is the author of Tubes and The Weather Machine
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