Overcoming challenges to building green power markets

Climate change is one of the key challenges of the 21st century Source: “Climate Change: State of Knowledge Report,” Office of Science and Technology Policy, Executive Office of the President, 1997

Burning fossil fuels is the largest source of US man-made greenhouse gas emissions... Source: US EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: (2004), Table ES-3. Does not include sinks. 82 Energy generation from fossil fuels 7 4 Industrial processes & manufacturing Agriculture US GHG emissions by source (2002) Percent, 100%= 6,934 Tg CO 2 e* * Tg CO 2 e = Teragrams of carbon dioxide equivalents 7 Fuel processing & other

...and the largest source of corporate GHG emissions in the US US industrial sector GHG emissions (2002) Purchased electricity On-site energy generation Percent, 100%= 1,987.2 Tg CO 2 e * US commercial sector GHG emissions (2002) Purchased electricity On-site energy generation Percent, 100%= Tg CO 2 e * Industrial processes & manufacturing 36 Source: US EPA, Inventory of U.S. Greenhouse Gas Emissions and Sinks: (2004), Table ES-6. Does not include sinks. * Tg CO 2 e = Teragrams of carbon dioxide equivalents

Green power Energy efficiency Process improvements Switching to green power is a strategy for reducing corporate GHG emissions Carbon sequestration

In 2000, WRI convened the Green Power Market Development Group Developing corporate markets for 1,000 MW of new, cost-competitive green power by 2010 Alcoa Inc. Cargill Dow LLC Delphi Corporation DuPont General Motors IBM Interface Johnson & Johnson Kinko’s Pitney Bowes Staples The Dow Chemical Company

The Group is pursuing several forms of green power Wind Solar Biomass Landfill gas Geothermal Low-impact hydro Clean technologies (e.g., fuel cells)

36 MW Total = 112 megawatts (MW) The Group has completed 112 MW of green power projects and purchases Renewable energy certificates Hydrogen fuel cells Wind power Landfill gas Other renewable power As of December 2003

US green power markets are growing MW installed capacity Source: U.S. Department of Energy (Wind Energy Program) & AWEA (2004). Available at: IEA Photovoltaic Power Systems Programme (2003). Available at: Solarbuzz “Annual World Solar Photovoltaic Market 2003 Report” (2004). Available at: Wind Solar 16% CAGR 19% CAGR

However, green power markets for corporate energy users face several challenges Large up-front capital expenditures for on-site systems High cost per kilowatt-hour Lack of availability in some regions

Claire Broido Vince Van Son Mark Buckley Today’s speakers will share new business models & products that address these challenges