Steve Hoy is IBM’s former Global Smart Grid Systems Leader and CEO of Enosi, a company supporting the transition to clean energy. This contributed content represents the views of the author, not those of Canary Media.
Recently, Google came clean.
The tech giant tacitly acknowledged that like almost every other major enterprise, its use of carbon offsets fell short, and that while renewable energy certificates have their place, they are also a way for well-funded companies to buy themselves out of a problem. Google is the first to admit this and do something about it.
In this case, "doing something" means signing a 10-year contract with AES to supply 24/7 carbon-free energy to Google’s data centers in Virginia — and implementing a goal to power its data centers around the world with exclusively round-the-clock carbon-free energy by 2030.
Simultaneously, President Joe Biden set an ambitious goal to make the electricity to federal buildings 100 percent carbon-free. Energy Secretary Jennifer Granholm said recently, “We...are all in on making sure that we meet the president’s goals of getting to 100% clean electricity by 2035.” While details on the execution are scant for now, it’s a signal that carbon-neutral is no longer enough.
If we want truly clean energy, we have to use 100 percent clean energy. This means accepting that green energy certificates artificially shift claims of renewable consumption across time and even across the globe. Buying a certificate created by a solar farm on some other grid doesn’t mean that your business bought clean energy for its nighttime operations. Certificates will soon be superseded by traceability technology, which allows us to see the source, the time and the price of the energy purchased.
It's only a matter of time before certificates and offsets go the way of the fax, taking the old world of net-zero goals with it.
True zero will drive the era of honest electricity
"True zero" is our term for the fulcrum on which we can lever fossil fuel generation out of the market. It’s unlocked by traceability and transparency revealing exactly where our electricity is sourced. Almost everything else in our lives can now be tracked and traced, but energy, especially clean energy, has remained hidden behind a confusing mesh of regulation, plans, subsidies, taxes and wildly divergent pricing.
Consumers large and small are turning their attention to provenance, demanding clean energy from source to socket. Allowing buyers to purchase clean energy exactly matched in time to its generation will ultimately drive fossil fuel out of the market and accelerate the transition to 24/7 carbon free energy.
Exposing and driving the demand for clean energy
With 24/7 traceability, consumers are given transparency and choice like never before. They can see and choose where they want to buy their power from and can be assured that clean power is delivered — or have honest reporting when it is not available.
To really drive this change, consumers will need to see that the price of their traced clean energy on their bill is better than the alternative. We envision two-part energy plans where consumers see the lower price of, say, solar farm power versus the firming generation that fills in the gaps. Consumers can take action, demanding a higher proportion of renewables in the mix, and even shift their demand to times when clean energy is available. This in turn pushes up demand.
As a result, traceability will speed the development of even cheaper and cleaner energy generation sources across the 24-hour cycle. Those building the next wave of power plants, either renewable generation or battery storage, will have a clear path to market. The consequences for how we do business in all sectors will be profound.
Big business leading the way
In January, Larry Fink, CEO of Blackrock, pledged that his $7 trillion fund will be demanding measurable climate impact accountability from the companies it invests in, signaling the end for so-called greenwashing.
Fink isn’t alone. In the tech space alongside Google, both Microsoft and IBM have all made traceability commitments for the clean energy purchasing to meet their true-zero carbon goals. These leaders have recognized that certificates and offsets leave too much wriggle room for fossil-fuel supply.
If their current true clean energy match is measured at 60 to 70 percent (rather than “100 percent offset”), that’s a good thing, creating the incentive for improvement and the metrics to assess Fink’s “measurable climate impact.” As clean energy continues to be cheaper than fossil fuels, there will be savings involved in making these clean energy choices.
Traceability technology is here
The brute force of economics will unlock and accelerate the transition as low-cost wind and solar muscle out fossil fuels. Technology is the key driver in this, and it’s coming fast. My team has focused on the development of a key part of cracking the puzzle — the 24/7 traceability algorithm — but there are literally thousands of experts around the world driving this change.
Digitizing the grid means we can measure electricity source and flow in minute detail. Software is now capable of simultaneously matching kilowatt-hours going in with kilowatt-hours going out. It is a straightforward but transformational change, just as we have seen a single app disrupt the taxi industry globally.
Within a year, the demand from organizations proactively seeking power source accountability will grow. As major companies vote with their wallets, we will see major divestment from conventional power, delivering both money savings and brand benefits. Those in business today should know that true zero isn’t coming — it is already here.
(Article image courtesy of Dimitry Anikin)
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