The number of firms pledging to transition to 100% renewable energy through the RE100 is expected to double by the end of 2016 according to the chief executive of the group behind initiative.
Speaking at last week’s Clean Energy Summit, The Climate Group’s Mark Kenber said that well over 100 firms will have committed to using only clean energy over the course of the year, up from the 58 companies currently working towards meeting their commitments.
“Those 58 companies, once they have met their renewable energy targets, will be responsible for buying equivalent to all the electricity consumed in Hong Kong and Singapore, and that’s only the 58 companies so far – 90 TWh – and that’s going to grow,” he said.
According to the most recent update on the progress of firms signed up to the scheme, RE100 firms are 50% of the way to meeting their renewable electricity targets, with some already having reached 100%.
Kenber says the growing engagement of firms with The Climate Group scheme is a sign of rapid changes in who is promoting the clean energy agenda, as private firms overtake national governments in their efforts to decarbonise.
“I think one of the big drivers we’ve seen over the last few years has been a shift from companies waiting for government to say something is going to happen and then responding to a situation where companies, investors, cities and regional governments have actually driven national governments to take action that they haven’t always been enthusiastic in taking,” he explained.
Kenber was joined on stage by representatives from a number of RE100 companies, including Joanna Yarrow from IKEA, which was one of the early members of the scheme.
The Swedish furniture and homeware giant has committed to renewably generate at least as much energy as it uses by 2020. Yarrow said it had reached 53.4% by last year, having spent around €1.5 billion euros since 2010 on 700,000 solar panels and 327 wind turbines.
While firms like IKEA are motivated by the CSR benefits of going green, Yarrow also explained that investment in renewables also presents a strong commercial opportunity to save money.
“Since energy is our second biggest cost after staff there’s a very simple business case for doing this,” she said.
“It gives us a lot of capacity to insulate ourselves from price rises and fluctuations so we can take control and plan our business into the future. So it’s really quite a hard-nosed business thing at the end of the day.”
Kenber went on to say that whatever the reasoning behind large firms investing in clean energy technologies, the effect is having an important impact on how renewables are viewed by government.
“It’s important because it creates demand; it shows governments that renewable energy policy is not just something nice, it’s something that companies really want and it provides a stimulus to the market that perhaps was lacking or absent when we were aligned only to government policy,” he said.