In a record year for clean energy purchases, Southeast cities stand out
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Municipal Renewable Energy Procurement surged as cities contracted 3.7 GW of solar and wind, leveraging green tariffs, community solar, and utility partnerships across the Southeast, led by Houston, RMI, and WRI data.
Story Summary
The process by which cities contract solar and wind via utilities or green tariffs to meet climate goals.
3.7 GW procured in 2020, nearly 25% year-over-year growth
Houston runs city ops on 500 MW solar, a record purchase
Southeast cities use green tariffs and community solar
Cities around the country bought more renewable energy last year than ever before, reflecting how renewables may soon provide one-fourth of U.S. electricity across the grid, with some of the most remarkable projects in the Southeast, according to new data unveiled Thursday.
Even amid the pandemic, about eight dozen municipalities contracted to buy nearly 3.7 gigawatts of mostly solar and wind energy — enough to power more than 800,000 homes. The figure is almost a quarter higher than the year before.
Half of the cites listed as “most noteworthy” in Thursday’s release — from research groups Rocky Mountain Institute and World Resources Institute — are in the region that stretches from Texas to Washington, D.C.
Houston stands out for the sheer enormity of its purchase: In July, it began powering city operations entirely from nearly 500 megawatts of solar power — the largest municipal purchase of renewable energy ever in the United States, as renewable electricity surpassed coal nationwide.
The groups also feature smaller deals in North Carolina and Tennessee, achieved through a utility partnership called a green tariff.
“We wanted to recognize that Nashville and Charlotte were really blazing a new trail,” said Stephen Abbott, principal at the Rocky Mountain Institute.
And the nation’s capital shows how renewable energy can be a source of revenue: It’s leasing out its public transit station rooftops for 10 megawatts of community solar.
All of these strategies will be necessary for scores of U.S. cities to meet their ambitious climate goals, researchers believe. An interactive clean energy targets tracker shows all 95 clean energy procurements from the year in detail.
Tracker
Even before former President Donald Trump promised to remove the United States from the Paris Climate Accord, a lack of federal action on climate left a void that some cities and counties were beginning to fill, as renewables hit a record 28% in a recent month. In 2015, the first year tracked by researchers at the Rocky Mountain Institute and the World Resources Institute, municipalities contracted to buy more than 1 gigawatt of wind, solar and other forms of clean energy.
But when Trump officially set in motion the withdrawal from the climate agreement, the ranks of municipalities dedicated to 100% clean energy multiplied. Today there are nearly 200 of them. The growth in activity last year reflects, in part, that surge of new pledges.
“It takes a while to get city staff up to speed and understand the options, and create the roadmap and then start executing,” Abbott said. “There is a bit of a lag, but we’re starting to see the impact.”
Even in Houston — one of the earliest to begin procuring renewable energy — there has been a steep learning curve as market forces change and prices drop, including cheaper solar batteries shaping procurement strategies, said Lara Cottingham, Houston’s chief of staff and chief sustainability officer.
No matter how well resourced and educated their staff, cities have to clear a thicket of structural, political and economic challenges to procure renewable energy. Most don’t own their own sources of power. Nearly all face budget constraints. Few have enough land or government rooftops to meet their goals within city limits.
“Cities face a situation where it’s a square peg in a round hole,” Cottingham said.
The hurdles are especially steep in much of the Southeast, where only publicly regulated utilities can sell electricity to retail customers, even large ones such as major cities. That’s where a green tariff regime comes in: Cities can purchase clean energy from a third party, such as a solar company, using the utility as a go-between.
Early last year, Charlotte became the largest city to use such a program, partnering with Duke Energy and two North Carolina solar developers to build a solar farm 50 miles north in Iredell County. At first, the city will pay a premium for the energy, but in the latter half of the 20-year contract, as gas prices rise, it will save money compared to business as usual.
“Over the course of 20 years, it’s projected we would save about $2 million,” Katie Riddle, sustainability analyst with Charlotte, told the Energy News Network last year.
The growing size of projects, innovative partnerships like green tariff programs, and the improving economics all give Abbott hope that renewable energy investments from cities will only grow — even with the Trump presidency over and the country back in the Paris agreement.
And when cities meet their goals for procuring renewable energy for their own operations, they must then turn to an even bigger task: reducing the carbon footprint of every person in their jurisdiction with broader decarbonization strategies and community engagement.
“The city needs to do its part for sure,” said Houston’s Cottingham. “Then we have this challenge of how do we get everyone else to.”
