If the world is going to meet the climate goals set in the Paris agreement in 2015, there will need to be an estimated $1 trillion in clean energy investments per year in the coming decades. In the United States, much of that money will need to come from electric utilities that deliver power to our homes.
But on that front there are wide disparities in renewable adoption, according to a new report from Ceres, a nonprofit that focuses on sustainable business and investing.
The group looked at clean energy use of 30 largest investor-owned utility holding companies in the United States, which together account for nearly 60% of total U.S. electricity sales in 2014. It finds that some utilities are adopting clean energy much faster than others.
Compare Sempra Energy, which gets 36% of its retail electricity from renewables and is the top-ranked utility, with one at the bottom: American Electric Power, where renewable use is at less than 1%.
"State and regional policies play a really significant role," says Dan Bakal, Ceres’ electric power director. "That’s not really surprising, but the report really highlights that.
It’s unsurprising that utilities that operate in states like California, New York, Oregon, and Vermont produce more renewables and have made bigger commitments. These states have renewable electricity targets that eventually ramp up to anywhere from 50% of the power supply to even 100%. By comparison, states in the U.S. southeast have had comparatively few policies to encourage renewable adoption. Some are actively discouraging it—for example, Nevada recently passed controversial rules that reduce the financial incentives for homeowners to put solar panels on their roofs. All but four states in the U.S. made some sort of solar policy decision in 2015.
Solar and wind capacity is growing at a quick clip—at rates of 27% and 11% respectively in 2015. Overall, the 30 companies in the report provided 13% more renewable energy and 9% more energy efficiency savings from 2013 to 2014 (the year that company-level data was considered). The top four ranked of these companies in terms of renewable energy sales—Sempra Energy, PG&E, Edison International, and Xcel Energy—together accounted for more than 50% of all renewable electricity sales.
Even in the states that are lagging in renewable adoption policies, says Bakal, one positive trend is the growing corporate demand for renewable energy. "This seems to be growing very rapidly and that’s happening in all states," he says. The number of corporate renewable deals increased by three times in 2015. President Obama’s Clean Power Plan—should the policy make it through lawsuits—could also level the state-by-state playing field.
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[Cover Photo: Wang An Qi via Shutterstock]