10 Steps to Becoming a Carbon Neutral Business

Page 23 STEP 07: SWITCH TO RENEWABLE ENERGY There are three renewable energy options available, each described in detail below. Key characteristics of RECs, PPAs and on-site installations RECs PPAs On-site installations Feasibility Feasible almost everywhere Only in deregulated energy markets Feasible almost everywhere Ownership of renewable energy installation No ownership, the RECs only certify that the electricity purchased is green, but do not include the underlying electricity No ownership Full ownership Upfront investment required None, only pay for the amount of RECs purchased None, the renewable energy installation is not owned Significant upfront investment required to install owned on-site production Separate energy contract needed Yes, the RECs only certify that the electricity purchased is green, but do not include the underlying electricity No, PPAs are contracts for the sale of electricity and replace existing contracts No, unless on-site production does not cover 100 percent of energy consumption, in which case the remaining consumption has to be covered by separate contracts Profitability The cost of RECs are additional to your existing energy contracts and therefore an added cost Possibly profitable option, depending on how energy market prices develop during the contract period. Could also result in financial losses Possibly highly profitable option, depending on how energy market prices develop during the lifetime of the on-site installation. Could also result in financial losses Complexity Process of purchase is straightforward and fast Potentially complex process, usually taking between six months and two years Potentially complex process, usually taking between six months and one year Duration One year 10-15 years 10-20 years Brand value Least compelling story about commitment to renewable energy Straightforward story about commitment to renewable energy Most compelling story about commitment to renewable energy