In 2021, more than 40% of the energy-related CO2 emissions came from the burning of fossil fuels solely for electricity generation. This is occurring just less than a decade away from the global commitment to halve emissions in 2030 (compared to 2010 levels) in order to keep global warming below 1.5°C.
Therefore, large-scale movements away from non-renewable energy resources by the major consumers of electricity are becoming increasingly crucial for climate action. One of such initiatives to decarbonise the power grid, specifically in the corporate world, is RE100.
What is RE100?
Led by the Climate Group in partnership with CDP, RE100 is a global corporate renewable energy movement that aims to accelerate the transition towards decarbonised electricity grids, by creating a credible and transparent tracking system.
The membership is generally targeted at large corporations with an electricity demand of at least 0.1 terawatt-hour (TWh) per year. The RE100 requires member companies to openly commit to using 100% renewable electricity across all its local and global operations, latest by 2050. Annually, RE100 publicly reports a list of its active members and each of their progress towards 100% renewable electricity.
RE100 recognises renewable electricity generated from geothermal, solar, wind, tidal energy, and hydropower (large and small). Biomass (including biogas) can also be recognised as a renewable energy source for electricity generation, provided they are created sustainably.
Currently, more than 360 companies operating in over 175 markets across multiple sectors have become RE100 members. Together, they create a total electricity demand of at least 380 TWh per year. Although most of the members are headquartered in Europe, companies headquartered in the Asia-Pacific have accounted for over 40% of RE100’s annual new membership rate since 2018. The majority of the new members in 2020 came from the manufacturing sector, though the services sector still dominates.
How can companies join the RE100 movement?
The application time for new RE100 members typically takes around 2 to 3 months. The chart below lays out the 8 steps that a prospective member has to undergo, which can be openly accessed in detail through the technical guidance page on the official RE100 website.
What are the criteria for joining?
To be eligible for a RE100 membership, a company must adhere to a specific list of criteria.
One of the key points to note is the necessity of the company to be transparent in their progress and targets in their annual RE100 reporting. Moreover, it needs to publicly pledge to source 100% renewable electricity by 2050, with reaching at least 60% by 2030 and at least 90% by 2040.
Another important aspect is the company should apply for membership at the group level. This means that all its branches and operations worldwide must commit to using 100% renewable electricity, each directly sourcing from the respective market boundary that they operate in.
RE100 uses countries’ geographic boundaries to define the market boundaries, with the exception of Europe and North America. For example, a Japanese company that has a branch in Indonesia cannot only source renewable electricity from Japan to claim 100% renewable electricity, but it must also source renewable electricity from the Indonesian market to match the electricity used in its operations in Indonesia.
A more comprehensive detail on the criteria can be seen through the official RE Joining Criteria document.
How can RE100 members credibly claim the usage of renewable electricity under RE100?
Once a company successfully becomes a RE100 member, they need to be mindful about how they claim their use of renewable electricity.
To make a credible claim of using renewable electricity, a member company must strongly demonstrate that the specific renewable electricity generated is exclusively for the company to match its reported electricity usage. This makes it mandatory for renewable electricity attributes to be trackable to prove its ownership.
To be able to track and verify the ownership of attributes, companies can source renewable electricity through trackable renewable energy contractual instruments. This mainly comes in the form of Energy Attribute Certificates (EACs), where one certificate is equal to one megawatt-hour (MWh) of renewable electricity. EACs can either be bundled or unbundled (i.e., with or without the physical delivery of renewable electricity for the company’s use).
It is common to identify unbundled EACs, which also makes the attributes easily tradable between companies in the same grid to claim renewable electricity. Once ownership is claimed to match a specific electricity usage, the specific EACs are retired or cancelled and would not be able to be used again.
Some of the EACs accepted by RE100 include North America’s Renewable Energy Certificate (REC), Europe’s Guarantees of Origin (GOs), International Renewable Energy Certificate (I-REC), and Tradable Instrument for Global Renewables (TIGR) (available in international markets).
In places where EACs are not available, renewable electricity can be claimed using other contractual instruments or other direct contracts between a member company and a renewable electricity supplier. For example, this can be done through a direct Power Purchase Agreement (PPA) where the renewable electricity is physically delivered for the company’s use in its operations.
According to RE100’s guide on making credible renewable electricity usage claim, the following criteria for contractual allocation of attributes (including EACs) must be fulfilled:
- Credible generation data: static data must be verified by third parties and dynamic (generation) data must be metered.
- Attribute aggregation: a credible claim requires “ownership of all environmental and social attributes associated with the generation that can be owned, and that none of these attributes have been sold off, transferred, or claimed elsewhere”.
- Exclusive ownership of attributes: no “double counting” of attributes, meaning that the same MWh electricity cannot be tracked in more than one way (e.g., a generator cannot be registered for more than one type of EAC).
- Exclusive claims of attributes: no “double claiming” of attributes, meaning that two different parties cannot claim the same MWh of renewable electricity.
- Geographic market limitations of claims: attributes must be procured within the same market boundary.
- Vintage limitations of claims: generation date (vintage) of the renewable electricity that is claimed must be as close as possible to the reporting year of the electricity consumption to which it is applied.
Current trends and opportunities
As RE100 members continue to increase, they inevitably create higher demands for electricity generated from renewable sources.
According to the latest RE100 annual disclosure report published in 2021, existing RE100 members claim that they still faced obstacles in sourcing renewable electricity. Many of the members, specifically in South Korea, Japan, China, and Singapore, expressed “lack of procurement options” and “limited or no supply available”.
This could encourage renewable energy investment and indicate an economic opportunity for renewable energy project suppliers. They could generate extra income from their renewable energy generators by registering it under one of the EAC standards, or by making a direct PPA with a RE100 member company where EACs do not exist. Some of these proceeds could then be invested back for the development of more renewable energy projects.
RE100 has been a great initiative in bringing many of the world’s largest contributors of electricity-related CO2 emissions towards decarbonising their operations.
As the movement continues to rapidly grow, RE100 is aware of some key technical aspects to further define or consider in order to improve. In their 2022 open consultation which they held previously from March until May, they highlighted three main topics to consider for 2023: redefining the “market boundaries” in Europe; possibly setting a concrete set of conditions that could allow for procurement across market boundaries; and putting a fifteen-year commissioning date limit on the facilities from which members may claim renewable electricity that are purchased.
In relation to this, RE100 plans to increase its impact by giving additional recognition to those companies using a more direct source of renewable electricity, produced from more recent generators with proven additional and sustainability labels.