Companies Want Renewable Energy

Companies Want Renewable Energy

You might’ve heard about ways that consumer demand for renewable energy is driving lots of different investments around the state. But did you know there is also a huge amount of economic potential that could be generated from the renewable energy demands of commercial and industrial entities?

New research indicates there is significant economic opportunity to be gained if Indiana can provide the kinds of renewable energy options that companies are seeking.

 

Companies Want Renewables

A report from earlier this year found that Indiana could benefit from $5.78 billion dollars in investment and nearly 25,000 jobs over the next 10 years if commercial and industrial businesses had more options to procure renewable energy through their electric utilities.

That data comes from a report titled Opportunities for Meeting Commercial and Industrial Demand for Renewable Energy in Indiana that was published by Advanced Energy Economy (AEE), a trade association representing the energy industry. Research for the report was conducted by WoodMackenzie, an independent research and consulting firm focused on the energy, chemicals, metals, and mining sectors.

 

Utilities at the Forefront

Currently, companies in Indiana have limited options to purchase renewable energy – but that’s changing. Multiple Hoosier utility organizations have begun expanding their portfolios by adding sources like wind and solar. A good example would be NIPSCO’s announcement to close all of its coal-powered generation by 2028 and replace it with a mix of wind, solar, energy storage, and demand-side resources that are expected to save consumers about $4 billion.

At the time of the announcement, NIPSCO said their decision was based purely on simple economics – demand was present, and the cost of renewables was more affordable to provide. Since then, demand has only increased. Last year, for example, nine large companies with Indiana operations published a letter to legislative leaders calling for more utility purchasing options for advanced energy resources. The report’s authors noted examples like these will act as a platform to inspire other developments.

“As the cost of wind and solar continues to decline and the commercial and industrial sectors turn to these resources to source their electricity needs, these positive examples create a foundation for more investment in renewable energy to meet customer demand. Today, Indiana has the potential to stimulate significant market activity by enabling renewable energy procurement,” wrote Aaron Barr, principal consultant with Wood Mackenzie.

 

Growth, Either Way You Look at It

To make their 10-year projections, researchers evaluated their data using two perspectives, a baseline case and a growth case, to estimate demand for renewable energy from commercial and industrial customers. Researchers then calculated the range of economic benefits in investment, jobs, and income that would result from meeting this demand with in-state solar and wind energy development.

Key findings based on the two outlooks included:

  • Significant growth in renewable energy demand is expected from large energy users from now until 2030, ranging from 1.7 gigawatts (GW) under the baseline scenario to 3.6 GW under the growth scenario.
  • If this growing demand is met, Indiana would see $229 million to $482 million a year in capital investment and over 11,500 to nearly 25,000 jobs created over the next 10 years. This includes roughly both permanent operations and maintenance jobs and temporary construction jobs.
  • Wages created by renewable energy development in Indiana through 2030 would range from $1 billion and $2.2 billion.

 

Cutting Overhead Costs

There’s a real opportunity in renewables for Indiana’s marketability because they are becoming a very popular option for reducing energy costs in companies throughout the country. If economic development and utility officials position the state at the forefront of the trend, it would only enhance our business attraction competitiveness. Renewables are also a solid long-term factor that could boost business retention as they tend to insulate budgets against unexpected energy rate changes.

As noted by the report’s authors, “States and utilities that unlock attractive renewable energy purchasing opportunities are better hosts for businesses looking to expand or move their operating footprint.” For that reason alone, it would be wise for Indiana to take advantage of renewables to a greater degree and work to expand commercial and industrial access.