Companies don’t have to be as big as Walmart Inc. or Facebook Inc. to buy solar or wind power anymore.
Businesses with more modest appetites for electricity — including Swiss Re AG, Nestle SA and others — are increasingly banding together to line up deals for clean power, broadening a market long dominated by tech giants, according to a report Thursday by Bloomberg NEF.
The strategy is enabling more companies to buy wind and solar power at prices similar to those paid by some of the biggest corporate users of renewable energy. It’s also boosting demand for renewables as concerns about climate change grow. Companies in the U.S. have already agreed to buy 5.9 gigawatts of clean power this year, more than double the total from 2017.
“It opens the door for so many companies that wouldn’t have bought clean energy otherwise,” said Kyle Harrison, a New York-based analyst at BNEF.
Until recently, three-quarters of corporate power-purchase agreement volumes came from the top 20 buyers, he said. But that’s changing. About 40 percent of the ones signed this year have been though aggregated deals, up from 11 percent in 2015. Buyers have included National Geographic and Etsy, according to the BNEF report.
The aggregated deals provide advantages to wind and solar developers, including enabling them to build larger projects and take advantage of economies of scale, BNEF said. On the downside, juggling a large cast of buyers with varying credit histories can pose challenges.
“Besides cities, companies have the biggest ability to reverse the negative impact of climate change,” Harrison said. “They can reduce their emissions at a scale that no other entity can.”