Prove your Green Energy Procurement by directly investing in Renewable Energy Assets

Direct Investments – Basic Structures   Source: Think RE GmbH, © Think RE GmbH

By directly investing in renewable energy assets the producer of renewable energy may simultaneously become the offtaker in case the energy output and energy attribute certificates are used for own purposes.

Direct investments in renewable energy projects were the major type for procuring Energy Attribute Certificates and green electricity.

However, the trend now is shifting towards power purchase agreements due to smallerupfront costs and more flexible accounting treatment.

The most obvious way to prove your green energy consumption is to build a power plant directly on your corporate site with a cable directly linked in your production facility or office building. However, these direct investments may induce several hurdles.

Find some of them below:

  • The available space on the site of corporate electricity consumers is commonly too small for installing enough renewable capacity for their entire electricity load (e.g. roof-top solar).
  • Corporate electricity consumers are often lacking the resources necessary for establishing a solid evaluation process to directly invest in the RIGHT opportunity.
  • In order to establish a proper electricity balancing, meaning matching the green power production with your individual consumption every second, requires a storage solution which increase your investment costs.

 

Global Overview for Direct Renewable Energy Investments   Source: Think RE GmbH, © Think RE GmbH

Note that Direct Investments do not automatically imply that the renewable energy plant is built on the site of the company (onsite). It is also possible that the plant and the energy consuming assets are located at different places (offsite).

In this case, a third party (called a Balancing Responsible Party) like a utility has to be included in order to “physically transfer” the green electricity to the exit point where it is consumed.

Independent from the geographical setup, the problems related to Direct Investments remain unresolved for the majority of our clients, making direct investments only a limited way for becoming a Renewable Champion.

 

According to the International Renewable Energy Agency (IRENA), the active market for direct investments accounts for annual global volume of more than 170 TWh equalling 2.5% of the annual total renewable energy production

Contact Think RE for more information