Trump’s White House Will Not Define Sustainability Standards — Tech Giants Will
April 30, 2018 · The Hill
Even as government agencies unequivocally acknowledge climate change and push for sustainability goals, the Trump White House continues to reject what the scientific community readily accepts: Climate change is likely humanity’s greatest threat, and we’re already experiencing its expensive and deleterious impacts.
In the first year of his presidency, Trump has done more to dismantle existing environmental policies than any previous president. His environmental regressivism is setting back the clock on sustainable practices, with global reverberations.
At the same time, corporate efforts to invest in renewables are gaining substantial momentum. Large enterprises — and tech companies in particular — are not only ramping up renewable energy purchasing, but are also setting concrete timelines for 100 percent renewable-powered operations.
New procurement models like aggregation fuel this moment, enabling small and mid-cap businesses to access to cheaper, lower-risk investments, much like the mutual fund offered all stock market investors. But will Trump’s anti-renewables policies derail this progress?
This is what Trump-imposed changes mean for the future of renewables:
Among Trump’s policy changes are several that appear to impede corporate buyers from investing in renewables. First, there’s the 30 percent tariffs he imposed on imported solar panels. Then there’s his 72 percent proposed cut to renewable energy research. And, of course, there’s his withdrawal from the Paris climate agreement. Meanwhile, Trump’s tax bill and steel tariff could both increase the price of renewable power. The ever-expanding list goes on.
But the simple answer is that none of these policies – past, present or future – will likely deter corporate customers from fundamentally reconfiguring energy markets through mass procurement of renewables. Trump’s punitive policies are speed bumps, not serious setbacks.
His solar tariffs, while inconvenient and moderately burdensome, won’t curb corporate interest in wind and solar energy power. His proposed cuts to government renewables research can’t impact the dramatic innovation underway in the private sector (in the near-term, anyway). And, his withdrawal from the Paris Agreement only emboldens enterprises, universities, cities and states to follow the agreement.
If anything, the administration’s vehement climate denial is invigorating energy buyers. There’s evidence of that in the “We are Still In” movement — a group of pledged Paris Agreement adherents that collectively constitutes $6.2 trillion of the U.S. economy — and in an October 2017 finding that 87 percent of corporations with an active renewables strategy say the Trump administration doesn’t change their commitment at all, while 11 percent say they’re actually more committed as a result of Trump.
The renewables industry has gained momentum that politics and policies cannot suppress. Economically, renewables have already won. The case for financial superiority is clear. From a business standpoint, that’s what counts.
Now Big Tech is setting sustainability standards — and smaller enterprises can get on board.
In April 2016, Apple, Google, Amazon and Microsoft filed an amicus briefwith the Environmental Protection Agency in support of the EPA’s 2015 Clean Power Plan, which argued for increased use of renewables. Within that brief, the companies affirmed their strong commitments to renewables, from both environmental and business perspectives.
Since filing the brief, these tech companies have only strengthened their commitments. In 2017, Google fulfilled its 100 percent renewable goal. Apple powers all its facilities with clean power and a notable number of its suppliers do too. Microsoft recently announced the largest purchase of solar power ever.
The speed of renewable progress within Big Tech has forged a path for other industries. While specific renewable targets vary across industries, enterprises of all types increasingly share green power aspirations. According to an April 2017 report from the World Wildlife Fund, 63 percent of Fortune 100 companies have concrete renewable benchmarks in place. These numbers will only rise as renewable purchasing options flourish.
Today’s corporate giants are sending a message: Having a coherent renewable strategy is a business imperative. Embracing sustainable energy is vital, in large part, because consumers are increasingly demanding that major brands fill the void left by government inaction. But what does that mean for smaller companies without deep pockets and huge risk tolerance?
Corporate customers procure their renewables in bulk, in complex wholesale markets. To less experienced and/or smaller corporate energy buyers, these markets present significant educational and economic challenges. To this complexity, smaller buyers can add the risk inherent in only buying power from a single project. As a result, smaller buyers are generally precluded from participating. That’s where traditional investment concepts of aggregation, diversified portfolios, and transparency come into play.
Recognizing a missed market opportunity, the energy industry is now enabling businesses to buy energy from new renewable projects in smaller quantities and across multiple projects. Like Vanguard democratized investing, an innovative procurement marketplace enables companies to buy power from diversified portfolios of energy projects. The emergence of this marketplace lowers entry barriers, makes buying feasible for smaller entities, and significantly expands the pool of buyers driving the renewable industry forward.
While the Trump White House is firmly committed to rolling back the clock on environmental progress, new transaction methods coupled with the leadership of large technology enterprises are catalyzing clean energy markets in ways unimaginable only a few short years ago.
Trump’s environmental policies do carry real implications for our planet, of course, but they can’t restrain sustainable corporate practices. The renewables train has left the station.
This story was originally published in The Hill.
Bryce Smith is the founder and CEO of LevelTen Energy. Smith co-founded OneEnergy Renewables, a national developer of utility-scale solar projects.Smith previously led the Bonneville Environmental Foundation’s nationwide investment in clean power projects.