Congratulations! You’ve already taken the crucial first steps on your decarbonization journey. You’ve gathered and analyzed your organization’s emissions data, conducted a carbon footprint assessment, and gained the support of key stakeholders and executives. You’ve even set emissions reduction targets, encompassing both scope 1 and scope 2 emissions, developed your initial roadmap, and started executing your plan.
Are you ready to take your decarbonization efforts to the next level? If so, as your organization moves forward, it’s time to become more ambitious and proactive in shaping your energy and decarbonization strategies. Here are critical actions that your organization should consider at this stage of your decarbonization journey:
STEP 1: Evaluate and refine existing initiatives
Assess the effectiveness and impact of your current decarbonization strategy and initiatives. Measure emission reduction, energy efficiency, renewable energy KPIs, and other relevant metrics. Determine if your organization’s operations have been changing or growing, impacting the viability of your decarbonization strategy. Consider strengthening your emissions reduction targets and pursuing additional renewable energy solutions. Continuously monitor progress, adapting to changing circumstances and maintaining flexibility in your approach to enable your strategy to evolve and improve over time.
STEP 2: Set more ambitious targets
Expand your organization’s GHG emissions reduction targets, aligning with your long-term sustainability goals and decarbonization ambitions, as well as industry best practices and global sustainability frameworks. If you set your scope 1 and scope 2 emissions reduction targets but have not determined your scope 3 and net zero targets, now is the time to get more ambitious.
Scope 3 emissions – including emissions from the supply chain and product use – account, on average, for 75% of organizations’ total emissions, according to CDP data. By including scope 3 emissions in your decarbonization targets, your organization can take a more comprehensive approach to addressing your entire value chain’s carbon footprint.
Setting net zero targets should come as a natural progression in your organization’s decarbonization journey, following setting ambitious scope 1, 2 and 3 targets. Net zero targets aim to create a balance between carbon emissions produced and carbon emissions removed from the atmosphere. The timeline for net zero targets depends on your organization’s ability to implement emissions reduction measures. However, many organizations are committing to achieving net zero emissions by 2050 or earlier, aligning with global climate goals.
STEP 3: Build partnerships and collaborations
Building partnerships and collaborations to leverage expertise and share best practices is essential to maximize the impact of your sustainability efforts. When seeking partnerships with external organizations, industry associations, NGOs, and other relevant stakeholders, identify potential partners with complementary expertise and aligned sustainability and decarbonization goals. Participate in industry events, workshops, and conferences to connect with like-minded organizations and facilitate knowledge-sharing.
To leverage expertise and share best practices, learn from others’ successes and challenges while being open to sharing your own experiences and valuable insights. Establishing joint working groups or task forces focused on specific decarbonization initiatives can provide a structured approach to collaboration and problem-solving.
Additionally, partner with NGOs and research institutions to access cutting-edge research, data, and scientific expertise, which can inform decisions and enhance the effectiveness of your organization’s decarbonization efforts. Try to foster strong partnerships and collaborations to tap into a collective pool of knowledge and resources, accelerating your decarbonization journey and contributing to broader sustainability goals.
STEP 4: Leverage a holistic approach to advance your energy and decarbonization portfolio
There is a wide range of energy and decarbonization solutions available for incorporation into your energy portfolio – however, no single option addresses every need you may have. As a result, you need to think holistically about your organization’s sustainability and clean energy strategy, adopting complementary and integrated solutions that solve challenges and fill gaps.
An integrated portfolio of solutions should include carbon reduction solutions – but also address energy conservation, generation, monetization, and resilience. An orchestrated, cohesive roadmap considers all appropriate energy solutions, how they interact with each other, and proper deployment order to maximize energy cost savings and carbon reduction.
Tackling your strategy in this way enables you to maximize all available opportunities, amplify the benefits of the technologies, and reach your energy and decarbonization goals faster. As your organization is looking to accelerate your decarbonization journey, we recommend you consider holistically the following energy and decarbonization solutions.
SOLUTION: Demand response (DR)
Earn payments for reducing energy consumption in times of electric grid stress through demand response programs and support a more flexible and sustainable energy grid. During supply-demand imbalances on the electric grid, DR programs act as a cleaner alternative to fossil fuel peaker plants, preventing blackouts. By agreeing to curtail electricity consumption when required, participants earn payments while ensuring grid reliability. Your organization can spend the payments you earn from DR on renewable energy initiatives in your energy and decarbonization portfolio.
SOLUTION: On-site distributed energy resources (DERs), including solar and battery storage
On-site solar and battery storage is a great way to leverage your facility’s infrastructure to generate and store on-site renewable energy, reducing energy costs, enhancing corporate sustainability, and boosting resilience – and integrating the two technologies amplifies the benefits of each solution.
Solar generation is a great way to decarbonize operations and transition to renewables instead of relying on grid power. However, solar generation is limited at night – and sometimes the system generates more energy than what is consumed on-site, wasting valuable renewables. And battery storage, when charged from the grid, doesn’t help with decarbonization.
The magic happens when these technologies are paired, allowing flexible usage of renewable energy. Battery assets can charge from solar power, discharging stored energy during periods of low solar generation.
SOLUTION: Unbundled Renewable Energy Credits (RECs)
Your organization can purchase unbundled RECs to match your electricity consumption from any source to claim a renewable energy, or green power, product. According to the U.S. Environmental Production Agency, a REC is a market-based instrument that represents the environmental and other non-power attributes of one megawatt-hour of renewable electricity that was generated and delivered to the electric grid. While bundled RECs come as a package deal together with the physical renewable electricity that they represent, unbundled RECs can be separated from the electricity they represent and can be bought and sold independently.
SOLUTION: Off-site renewable energy solutions, including VPPAs
If you are looking to meet your clean electricity needs and decarbonize at scale more easily than with on-site generation, there are several ways to do that through an agreement with a renewable energy partner. If you are a large organization with geographically dispersed facilities, you should consider a virtual power purchase agreement (VPPA).
Unlike a physical power purchase agreement (PPA), a VPPA does not deliver electricity to your organization directly. A VPPA is a financial transaction that delivers the environmental benefits of a large-scale off-site renewable energy project (i.e., renewable energy certificates or RECs) to your organization, while electricity generated by the project flows to the grid. VPPAs will not change how you power your facilities.
Depending on the load, VPPAs can help an organization meet 100% of their renewable energy needs – one contract can cover hundreds or potentially thousands of facilities that don’t have to be in the same geographic location. By becoming an offtaker on a new renewable energy project, your organization can claim additionality and implement projects in a region and grid where it will have a meaningful impact.
While VPPAs may require significant effort to execute and involve financial risk, choosing the right partner can make renewable energy purchases less complicated. Experienced renewable energy partners, like Enel, can help you customize the contract structure to suit your needs. In addition, our in-house trading desk is here to assist in effectively managing your financial risk.
SOLUTION: Green retail energy supply
If your organization is smaller, has one or a few facilities in the same geographic location, and has a low appetite for long-term commitments like VPPAs, you can power your operations with green retail energy supply. Partnering with a renewable energy company that offers electricity directly from their own renewable energy projects, like Enel, allows your organization to meet your decarbonization targets. Your organization will also be supporting your local economy and community if your green retail partner actively invests in local communities the way Enel does.
Green retail options and tariffs are usually available in deregulated energy markets, like ERCOT or PJM. They allow you to source renewable energy directly from a utility or supplier and generally are on-bill options. As a result, they are easy to manage.
SOLUTION: Maximizing community impact along with renewable energy
While clean energy procurement has become common for large organizations, the focus on responsible renewables or project co-benefits is less widespread. Collaborating with a renewable energy partner that delivers sustainability projects in local communities offers an additional advantage for your organization’s decarbonization and sustainability goals.
Enel is a notable example. Our customers can enhance their sustainability commitment through our Creating Shared Value programs that focus on a wide range of local community needs, including energy equity, environmental sustainability, health, education, and job training. Leveraging our unique expertise and connections, these programs enable your organization to support the local economy and empower communities near our renewable energy projects. In addition, you can co-develop a new project aligned with your strategy, a community of interest, and your sustainability goals with the Enel team – generating added value, unlocking new opportunities, and enhancing your organization’s reputation.
SOLUTION: Electric vehicle (EV) charging
Is your organization considering electrifying its fleet? Your peers are already making the switch, and it’s time for you to do the same. However, installing reliable EV infrastructure has energy impacts that should be considered. To manage the added load from charging, include on-site energy flexibility solutions like solar and battery storage. Combining these solutions enables utility bill savings, avoids interconnection costs, supports environmental goals, and ensures energy resilience during system outages.
Accelerate your decarbonization journey with a trusted energy partner
Your organization has already made meaningful strides in the decarbonization journey. However, this is not the time to rest on your laurels. As the expectations for sustainability continue to evolve, your organization should be proactive in recognizing your progress and taking the necessary steps to stay ahead.
At Enel North America, we have the right sustainability track record, experience, and expertise to work across solutions to integrate your strategy in the most effective yet simple way possible. As a turnkey provider of holistic energy solutions, we can help you accelerate your energy goals with a comprehensive energy strategy and roadmap to take your strategy to the next level. Take a look at our guide, Decarbonization navigator: a toolkit for organizations, to learn more about the specific steps required to jump-start your organization’s decarbonization journey. Contact us today to discover how we can guide you on that journey.