BMW, Google Have Promised To Become 100% Green! How And Why?

11/12/2015 9:12 PM IST | Updated 15/07/2016 8:25 AM IST
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Solar halo in grassland.

PARIS -- It is officially the last day of the U.N. Climate Change Conference, and it isn't clear just how long it will take for negotiators from over 190 nations to resolve contentious issues and deliver an international agreement to combat the global crisis.

While developed countries must shoulder the burden, developing countries must do their best, turning the tide against climate change boils down to every woman, man, child and company on Earth.

To this end, RE100 is a campaign to get influential companies to commit to switching all of the electricity that they are using to renewable sources.

Around 53 companies worldwide including BMW, Google, IKEA and Infosys have signed up to the campaign which was launched in September 2014 by two non-profit organisations - Climate Group and CDP.

Experts say that about quarter of all global emissions come from generating power from fossil fuels. And corporations make up about a 50 percent of that demand. So getting companies to switch to renewables could cut between 10 to 15 percent of global carbon emissions estimated to be over 40 billion tonnes.

emily farnworth

In a conversation with HuffPost India, Emily Farnworth, who heads the REE campaign, discussed why companies are exploring their renewable options, how far this is catching on in India, and how does one hold Google and BMW to their word.

Why should companies wants to use renewable energy?

Companies are realising that it makes good business sense for them to switch to renewables. A combination of reasons in terms of secure electricity prices, secure electricity, increasingly technology costs are coming down so in some parts of the world it can actually be cheaper to switch to renewable power.

What we're doing with this campaign is really demonstrating the market demand. So it sending the right signals to governments, other businesses, the energy market that companies want to make this move and help accelerate the process.

But the costs of renewables is high? So how does it make good business sense?

So, businesses have to buy electricity no matter what. Many of them are taking climate action. The science that we are seeing coming out of the COP in Paris is really strong in terms of recognising that we are all about building a low carbon economy. And many businesses recognise the need to do that. Looking at how they can cut carbon at the same time as making good business sense is obviously critical.

That is to say for many businesses the switch to renewable from fossil fuels does not necessarily cost anything. They are already reducing their energy demands so there is less electricity they have to switch to.

And just as an example in India, Infosys was the first Indian company to join the campaign and they have made a commitment to go 100 percent renewable by 2018 as part of their carbon neutrality goal, and what they are finding is that to actually be able to switch to renewables gives them more security of supply in terms of being able to manage their own solar resource but also they are not using diesel backup generators as much. So they are actually saving money by using solar power.

Infosys was the first Indian company to join the campaign to go 100 percent renewable by 2018.

Which companies have joined RE100?

We have 53 businesses that are currently part of the campaign. There are some big global brand names like Unilever, IKEA, Procter & Gamble, Google. BMW just joined. So there are a real range of big brands from all sorts of different sectors. And significant supply chains that will also help to increase the switch to renewables.

Joining is easy, but do these companies make some kind of specific commitment?

The majority of businesses have an end goal for their commitment. IKEA has a 2020 goal to be 100 percent, INFOSYS is 2018, Unilever has just committed to 2025. So we encourage all of the businesses to set a deadline. In many cases where companies are new to understanding the options of renewable energy, they set an interim goal. So they say 50 percent by 2020 or whatever it may be.

Typically, company wants to internally understand what are the steps I need to take to 100 percent and how quickly I can get there.

What is Google's goal?

So they haven't set an end goal for their 100 percent target. They are growing so quickly, they actually don't even know how much energy they will be using in the future. So, they've actually made a commitment to tripling the amount of electricity that they are going to take from renewables. They're biggest energy use is their data centres. They want to be able to make sure that where their consumers and corporate customers are using their products, they are using cloud that is powered by 100 percent renewables.

They have a number of programs to look at big power purchase agreements specifically on renewables. Again for them, the business case is that their customers are increasingly expecting them to have a low carbon cloud offering, but also being able to fix electricity prices from renewables gives them security of electricity prices in the long-term.

Are there any other Indian companies besides Infosys which have joined the campaign?

Officially, none have actually signed up yet. But we have been working in India for the last 12 months so we've been running workshops in Delhi and Mumbai. We have several face to face meetings, several conversations over the telephone with companies. We have a list of about 20 companies which are really interested in the campaign and want to know more about it. I'm quite confident that in the New Year, you'll be seeing some more Indian names appearing on the list.

How do you convince an Indian company to come on board?

I think there is a combination of reasons. Obviously, the cost of electricity in India is quite high and so if there is any opportunity for them to think about how they can secure the same price for the longer term or even a cheaper price then there is an interest. I think there is increasingly an idea of intermittency, which is sometimes a challenge for businesses in India.

So the idea of having a secure supply, particularly on site renewable energy generation, which they can control themselves instead of relying on a main central grid, is quite appealing. Like I said, Infosys actually saved money by not using back up diesel generation.

But investing in renewables would be much higher than this kind of saving?

India is one of the countries where the cost of solar projects is the same price as fossil fuel projects. The cost of solar technology has come down so much. They call it grid parity. So India is one of those countries where quite frequently you'll get projects coming online which are the same or cheaper than electricity prices from fossil fuels.

India is one of the countries where the cost of solar projects is the same price as fossil fuel projects.

How confident are you that RE100 will catch on in India?

When we first started with campaign, we weren't sure how many companies we would get on board. We're up to 53 now, we're talking to more companies which will be announcing in the New Year. The one thing this has done is to really help galvanize the imaginations of companies about what is possible.

In India, the combination of technology costs coming down, solar is just as cheap, there is lots of wind resource in India. The Indian government has made some very strong targets around increasing renewables, the electricity sector has got lots of regulations which is pushing them to get more renewables on the grid.

The combination of all of those reasons in addition to the strong signals that we are getting from COP in Paris, the long term future is in low carbon economy, many more Indian companies wanting to demonstrate low carbon leadership, many Indian companies are already looking at how they can address climate change, this initiative helps them to frame that with a more collective business voice. If we can get 10-20 companies in India by next that would be a really good step for us.

Is there a particular kind of industry which is keener to go green?

A lot of the companies that we have seen so far, coming on board, have been companies that perhaps have a consumer focused product, or they have a lot of environment impacts in their value chain, so they are seeing the impact of climate change and they want to do something about it, like the food companies.

The ICT (information and communications technology) companies because they are growing so fast. The ones who are making investments into new research facilities, new campuses, so they are thinking about electricity demand at the same time building out their infrastructure so they are at a very good stage in terms of thinking about renewables from the get go.

Interestingly, we had our first car manufacturing company come on board this week - BMW. So we are starting to see the manufacturing sector looking at how they can switch - again for the same business reasons as many of the others. They want to be able to secure electricity prices where they have a long term view of what that price may be and the fluctuation and uncertainty about fossil fuels is too risky. In many ways, this can be a cheaper option.

Companies are realising that it makes good business sense for them to switch to renewables.

It sounds really great that Google and BMW have committed to 100% green. But will they actually do it?

Absolutely. So when they joined the campaign, we do an annual progress report. First, we announced our bench-line report last January. We have first annual progress report coming out in January. So you'll see the numbers in terms of where they started, where they are now, and where they are going next. We'll be tracking their progress through CDP.

So all the companies, who join the campaign, have to give us information about their current electricity use, their current renewables electricity use, what their interim targets are, and we'll track their progress.

So, an honour system?

Absolutely. It is. But at the same time, there is a specific certification and verification system in place for switching to renewable energy. You can't just claim renewables without having a lot of information to back that up.

Out of the 53 companies that we have on board right now, the use, in total, is about 90 terawatt hours, which is not an insignificant chunk. But we want to grow that. Say we got to a 1000 companies on board, we've estimated that we can get to eight to nine percent of all global electricity use. It's not an insignificant amount of electricity that we want to switch to renewables.

COP21 coverage on HuffPost India is supported by CANSA and PAIRVI.

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