What You Need To Know About Additionality

Many companies working towards achieving net zero targets are already be purchasing renewable energy as one of the most obvious steps towards being sustainable. But, not all companies take the next step to buy renewable energy sources in a manner that puts renewable energy into the grid.

If we are to meet net zero goals and make a real impact, we must create a more sustainable grid and eliminate fossil power generated by fossil fuels. One method to do this is to provide more power.

In this article, we’ll look at the notion of additionality with regard to carbon offsets and renewable energy in addition to describing the many benefits for large companies. As a business there are options on the way you source renewable energy, and the chance to make a greater difference while meeting your the sustainability targets.

What is an additionality?

Additionality is a term used in renewable energy, which means that a company directly adds additional capacity to renewable energy to the grid of the nation. Organizations can increase their capacity by making investments in generators of green energy in a manner that permits them to finance the development of energy generation from renewable sources. One option for companies to invest is through Corporate Power Purchase agreements.

If you are a business can choose to contribute genuine green power sources like solar or wind energy on the grid instead of buying renewable energy sources that are already available. It’s as easy as signing up for an PPA which means that the renewable energy capacity of the future is integrated into the grid.

It is difficult to pinpoint and define beyond this because there is no universally accepted measures exist. Your investment may mean that the project is completed that it wouldn’t otherwise been able to happen faster, due to the purchase.

Potentially, additionality could be made by generating energy on-site, however this is only a possibility for certain types of businesses.

Renewable energy and additional sources of energy

When it comes to buying the renewable power, there’s methods to make it happen that will help you to deliver additionality. Additionality refers to an upgrade to REGO-certified green energy since you’re purchasing green energy in a manner that puts green energy in the grid. Big companies such as Google or Apple are the primary ones accountable for the development of new renewable energy projects, however, PPAs allow additionality for smaller organizations.

Many companies understand that acquiring quality renewable electricity is a crucial element in any zero net plan. But when it comes to procuring sustainable energy source, it is difficult to determine which option has the greatest real-world impact. There is confusion about the various methods, and worries frequently arise about the possibility of greenwashing. We have mentioned that one option to add further decarbonisation and additional electricity involves power purchase agreements (PPAs).

The popularity of PPAs is increasing, with certain businesses making use of them as a method for decarbonisation. However, more companies must be involved, in the right manner to reap the advantages that these contracts can bring, particularly considering the additionality benefits and net zero targets.

To get back to basics to the basics, a Corporate Power Purchase Agreement (CPPA) is an energy agreement for companies that want to purchase renewable electricity from a specific supplier. They can determine the price you will have to pay for this energy for the specified, typically longer (normally between 5 to 25 years) length of time.

When you buy your green energy direct through the producer, you and the generator get advantages. The producer is able to invest in renewable energy sources, thereby reducing the risk of the construction of new generation facilities. As a company you are guaranteed a price and protection from the increasingly volatile marketplace for wholesale electricity. This lets you budget to fund other initiatives that are focused on energy efficiency and get closer to achieving net zero.

There was a time that PPAs cost more and this meant it was a difficult choice to make to use PPAs. Presently, PPAs are in line with market prices, making them more appealing, with both added value and benefits. With PPAsyou might be able to get an arrangement for private wires which allows you to transfer renewable power directly from your generator of the provider to your company. This reduces the cost associated with having an intermediary utility provider, which makes the PPA much less of an expense.

Advantages of Additionality

Additionality has numerous benefits. It’s a badge of honour that highlights that you are committed to building a more sustainable future. It’s an active move to demonstrate the way to net zero for your company.

It is also possible to make additionality the primary and center of your sustainability strategy. As a company you are able to celebrate your contribution in aiding renewable energy facilities to be constructed. It could be the case that, without your financial support the plant would not be in existence. It’s a powerful narrative and marketing tool, and also a significant advantage over your competition.

Green and Additional Green and additional

As we’ve seen, the existing renewable energy supply capacity is in short supply and high demand. The businesses that are buying this green energy do not have the positive impact they’d like to. There is a new idea of deep green energy which involves actually making an impact by either creating your own energy, or by adding power to the grid. It’s a transition from REGO-backed energy and towards onsite energy generation as well as the purchase of PPAs.