Smaller Businesses Want Renewable Energy Developers To Spread The Green

Smaller Businesses Want Renewable Energy Developers To Spread The Green

A wind turbine stands on property used by the Iberdrola Renewables Holdings Inc. New Harvest Wind Power Project in Schleswig, Iowa, U.S., on Friday, Sept. 16, 2016. Photographer: Daniel Acker/Bloomberg

(Forbes) Wind energy, the fastest-growing source of electricity in the U.S., is transforming low-income rural areas in ways not seen since the federal government gave land to homesteaders 150 years ago.  Smaller enterprises want energy developers to spread the green, allowing them to get in on the renewable wave rolling through America. The dynamic has made it easier for larger corporations with more demand to buy wind and solar electricity but it has nudged out the less brawnier brands.

The guys at Google and Facebook, for example, are stimulating the need for wind and solar energy that they are using to feed their electricity-starved data centers. The developers of those energy projects, in return, are getting solid customers that are buying their output at a fixed price over a certain period of years.

But individual commercial and industrial customers aren’t generating the type of demand that can propel big energy projects into the market. Now, though, that may change. The same so-called power purchase agreements that are used to attract the likes of Microsoft, Intel and SAP can also be parceled out to smaller businesses, albeit in much smaller blocks of energy and for much shorter time frames.

“We connect the corporate community to power purchase agreements,” says Paul Schuster managing director for Altenex, a unit of Edison Energy , in an interview. “We have noticed those larger-to-mid-sized energy users need to achieve cost efficiencies, which can be done by buying smaller blocks of renewable electricity.”

A traditional power purchase agreement, for example, might require a company to buy 100 megawatts and it would last 20 years. But the contract now offered to the smaller players might be for 10 megawatts over 10 years.

So how does all this work? A wind developer can’t go forward until it knows that it can sell its output into the market at a fair price. Because there are tax breaks for both building the project and buying the […]

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