How to achieve 100% renewable energy
Initially, when you commit to 100% renewable energy it feels like a daunting target. Cost-effectively changing your whole energy supply from conventional fossil fuel sources procured via a small number of contracts, to one that is based wholly on renewable energy sounds difficult. However, when you break this target down using a methodical, planned approach that considers your boundaries, timeframes, what can be achieved now and what you might be able to do more of in future, your target will feel more feasible and within reach.
Like many approaches to resource conservation (for example, waste, water) reaching 100% renewables involves developing plans for different options for achieving your goal. In our experience, these options can be organized into three opportunity areas (Reduce, Produce, Purchase), and the approach taken is to assess the capacity and cost-effectiveness of actions in each area.
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1. Reduce energy demand
Referred to usually as ‘energy efficiency’, and more recently ‘energy productivity’, the most cost-effective renewable energy is often the energy that you don’t use. Businesses have made enormous strides to use energy more efficiently in recent years, helped by better information, financial incentives and the rapid development of technologies such as LED lighting.
Rather than a typical energy audit that may look for cost-effective opportunities for reducing energy demand in the short-term, a 100% renewables approach will look at energy demand more holistically.
Short-term energy efficiency plans will still look at energy waste, behavioural improvements, end-of-life technology upgrades and cost-effective retrofits such as LED lighting and BMS optimization. Bio fuel blends and fuel switching opportunities will also be evaluated.
Medium-term energy efficiency plans will look at the investments that your business will evaluate and schedule over the next 3 to 5 years. They will ensure planned capital improvements or fleet upgrades are energy efficient, develop a schedule for most capital-intensive retrofits that have good returns, and will continue to capture end-of-life upgrades and ensure maximum efficiencies are implemented with the best available technologies.
Long-term energy efficiency plans will look at the likely capacity for this area to contribute to your 100% renewables goal, so that you are well informed regarding the likely amount of renewables you will need to develop and invest in. Maintaining a focus on optimizing your energy demand will lessen the cost of renewables in the long term. Within this plan you should also look at your future transport needs, including the potential for electric vehicles to contribute towards your future energy mix.
2. Produce your own renewable energy
The last several years has seen an explosion in the use of renewable energy in Australia, with well over 1.5 million solar energy systems installed on homes. As costs continue to fall, the opportunities for business to benefit from the development of renewable energy projects – especially solar – are increasing.
In our experience there are two main types of opportunity for business:
Installing renewable energy such as solar PV, solar hot water, biomass energy generation or other solar thermal system after your meter ensures that your business maximizes the financial benefits, as energy distribution costs are avoided as well as retail energy charges. It is often uneconomic to export excess energy, unless it is to another energy user. Energy storage technologies are improving and their costs are reducing. This will help businesses to maximise the value of their renewable energy systems in future, and will help to reduce grid costs.
2.2. Generate on owned property
Many businesses have property (roof) space, infrastructure and/or land that is ideally suited to the development of renewable energy projects. Wind energy, solar PV, mini-hydro, bioenergy or other opportunities may be viable, even if the energy created exceeds the demand of the host sites, with generated energy offsetting retail energy purchases from the grid. The major aspects that your assessment will evaluate include the unsubsidized cost of energy generation, treatment of renewable energy certificates consistent with your goals, and retailer engagement and negotiation to facilitate this additional supply source.
3. Purchase renewable energy
When the cost-effective capacity of energy demand reduction and renewable energy production has been identified, the purchase of renewable energy or certificates may be the best way to complete your journey to 100%. Broadly there are two ways in which this is being achieved.
3.1. Purchase Renewable Energy Certificates or green power from your retailer
The traditional way for energy users to source renewable energy has been through the purchase of accredited GreenPower or other green energy from energy retailers. Usually this attracts a premium to grid energy supply. Similarly energy users can purchase Renewable Energy Certificates to ‘green’ their energy supply, at the prevailing market rate.
3.2 Directly purchase renewable energy generated off site
More recently we have seen the emergence of newer models for renewable energy purchasing, including direct purchases by end users of renewable energy generation output, or the establishment of buying groups to purchase renewable energy, typically from larger-scale plants.
The role of carbon offsets
The goal of achieving 100% renewable energy is challenging but achievable. Along the way, the cost-effective capacity of efficiency and renewable energy opportunities may fall short of your desired target. Equally, some plans may be delayed, not achieve their full potential, or your business growth may be different from what was expected. In these circumstances carbon offsets may be a good way to ensure targets are met while maintaining the target pathway to 100% renewables. This may be particularly helpful where, for example, transport and stationary fuel sources cannot readily be transitioned to renewables.