5 Tips for Renewable Energy Buyers

Purchasing green power has delivered impressive results for companies as varied as Johnson & Johnson, Toyota Motors, and Signal Mountain Lodge in Grand Teton National Park. Regardless of corporate buyers’ initial motivation to take the green-power plunge -- managing electricity costs, reducing exposure to environmental risks, or meeting sustainable-purchasing goals -- most renewable energy customers find that they not only achieve their original objectives but also experience unforeseen benefits. And renewable energy products have never been more plentiful, accessible, and cost effective. Now, a new wave of renewable energy adopters can draw from the lessons learned by industry pioneers to achieve greater paybacks from their green-power investments. Whether you plan to install on-site generation mechanisms such as solar PV or set your sights on buying green power contracts or tradable certificates (Green Tags), here are five tips that every potential customer should consider:

1/15/04

By Kevin Hagen

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2/9/04

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1. Every Little Bit Helps

You don’t have to convert 100% of your electricity usage to green sources to derive real business benefits. Start with any percentage that seems significant and manageable. A good guideline might be the threshold levels set by the EPA Green Power Partnership program. These thresholds start at 15% for small facilities but are as little as 1% for very large energy users. These targets offer some outside guidance rather than an arbitrary selection and have the additional benefit of qualifying the user for the EPA recognition program.

When Kinko’s began purchasing renewable energy, it didn’t start out with a national contract. Instead the company targeted specific stores and regions to make the most of local purchase prices -- often deriving 100% of an individual store’s total energy needs from renewable sources. The company was rewarded with substantial praise from employees, customers, and local communities affected by the program. And the approach must have paid big dividends in terms of real dollars; today, the renewable-energy program has expanded to include over 25% of Kinko’s locations in 18 states.

2. Make the Connection

We tend to take electricity for granted most of the time, failing to make the connection between simply turning on the lights and contributing to a major source of air pollution. Look for ways to make your purchase tangible to employees, customers, and other stakeholders. For example, it is more meaningful to say, “This building is powered by wind energy” than to say, “20% of our corporate electricity comes from green sources.”

For example, Aspen Ski Company got the word out to customers by publicly dedicating their wind-power purchase to running the very visible Sundeck Restaurant and the well-known Cirque chairlift at Snowmass. Similarly, Jackson Hole Mountain Resort in Wyoming committed their wind-energy purchase to running their Moose Creek and Union Pass chairlifts.

3. Communicate, Communicate, Communicate

As we’ve seen, two major barriers toward the mainstream adoption of renewable energy include the lack of appreciation for the environmental consequences of electricity production and insufficient publicity for readily available solutions. Communicating your renewable energy goals -- to employees and customers -- helps on both fronts. Tasteful messaging about your green power purchase increases the value of your program by generating goodwill with a variety of audiences and leverages your investment for additional environmental benefits as others follow your lead. Some corporate green-power buyers have increased these benefits by coordinating their efforts with suppliers, other companies, or local environmental organizations.

For example, the nonprofit Center for Resource Solutions, sponsors of the Green-e certification program, hosts regional awards events and sponsors joint promotional opportunities to help companies get the word out about their forward-thinking investments in green power. Recently, CRS created guidelines to enable manufactures to use the Green-e logo on the packaging of products made using green power.

4. Teamwork Counts

The more people within your organization are involved in implementation, the more returns you are likely to see. The reason is that many of the hidden benefits of buying renewable energy may only be apparent to people in a particular department. From management to rank-and-file, from operations to marketing, there are countless ways to apply the message and derive results. For example, operations might use green power as a motivation to conserve energy. Community relations might us it is as part of an outreach program or HR might use it in employee recruitment and retention. Let each department look for ways to connect with its specific audience. Greater employee involvement improves understanding and appreciation for the program and therefore delivers more results.

Example: When Clif Bar jumped into the renewable-energy market it bought enough green power and generation credits to offset the company’s entire carbon footprint, including the emissions associated with corporate air travel. Next they teamed up with their suppliers to help support the first Native American–owned large-scale wind farm in the U.S. The program later expanded to their customer base, when marketing executives thought to promote the company’s renewable-energy initiatives on the company Web site and allow customers to make their own wind-power purchases online. The company even offered a free box of Clif Bars to anyone who made a minimum wind power purchase through the site.

5. Consider the Source

As with any emerging market, renewable energy consumers should take steps to be sure they are making informed decisions. Because some new suppliers or products may be relatively unproven it makes sense to do the homework and ask the right questions. Even when the supplier is your utility company. Insist on a clear “content label” disclosing the type and source of the green energy offered. For example, is the power 100% renewable or is it “blended” with non-renewable power? In most cases if you plan on making any marketing claims it is advisable to insist on certification by a third party such as Green-e to avoid any ambiguity. With so many options available today, don’t stop with the first thing that comes along. You might even design your own plan to match specific company goals.

When two leading renewable energy industry manufacturers, Xantrex Technology and RWE Schott Solar, teamed up to buy 100% green power in 2001, they wanted their purchase to support the solar industry. Their supplier, Bonneville Environmental Foundation, proposed a combination of “Green Tags” from wind and solar sources and then agreed to use the funds to invest in solar PV installations.

Thousands of companies have made a business choice for renewable energy and have achieved impressive direct returns as well as surprising hidden benefits. With a little homework and some solid planning, your firm could be next.

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