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What is additionality?

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Many companies that are working to achieve net zero goals will already be purchasing renewable energy – one of the most obvious steps towards being sustainable. But, not all companies go the extra mile to buy the green power in a manner that puts renewable energy into the grid.

If we want to reach net zero goals and make a real impact, we must create a more sustainable grid and dispense with fossil power generated by fossil fuels. One method to do this is to provide more power.

In this article, we’ll examine the notion of additionality with regard to carbon offsets and renewable energy in addition to describing the many advantages for big businesses. As an organization there are options on the way you source renewable energy and have the opportunity to make a bigger impact while achieving sustainable goals.

What is an additionality?

Additionality is a term used in renewable energy. It is the term used to describe organizations that directly add additional capacity to renewable energy to the grid of the nation. Businesses can gain additionality by committing to making investments in generators of green energy in a manner which allows them to fund energy generation from renewable sources. One method for businesses to invest in renewable power is through Corporate Power Purchase agreements.

As a company can choose to contribute genuine green power sources like solar or wind on the grid instead of buying renewable energy sources that are already available. It’s as easy as signing up for an PPA which means that new renewable energy capacity can be being added to grid.

Additionality can be difficult to define and define beyond this because there is no universally accepted measures exist. Your investment may mean that an initiative is launched that it wouldn’t otherwise been able to happen sooner, as a result of the purchase.

The possibility of additionality is possible by generating energy on-site, however, this is only feasible for certain types of businesses.

Renewable energy and additional sources of energy

If you are looking to purchase the renewable power, there’s methods to go about it in a way that helps you to deliver additionality. Additionality is a way to upgrade to REGO-certified green energy since you’re purchasing green energy in a manner which actually places green energy into the grid. Big companies such as Google or Apple are accountable for the development of renewable energy projects however, PPAs allow additionality for smaller organizations.

A lot of businesses realize that purchasing quality renewable electricity is a crucial element in any zero net plan. But when it comes to procuring green energy sources, it is difficult to know which choice has the greatest real-world impact. There is confusion about the various methods, and worries frequently arise about the possibility of greenwashing. We have mentioned that one way to increase the amount of additionality and decarbonisation of energy involves power purchase agreements (PPAs).

The popularity of PPAs is increasing, with certain businesses making use of them as a method to reduce carbon emissions. However, more companies must participate, and correctly to reap the advantages that these contracts offer, particularly with regard to additionality and net zero targets.

For those who want to go back to the basics A corporation Power Purchase Agreement (CPPA) is an energy contract that can be used by businesses that wish to buy renewable energy directly from a particular producer. They can set the cost you have to pay for this energy for an agreed upon, usually longer (normally between 5 to 25 years) duration.

When you buy your green energy direct through the producer, you and the generator get advantages. The producer is able to invest in renewable energy generation, which reduces the risk involved in the construction of new generation facilities. As a company you can count on price certainty which protects you from the increasingly volatile marketplace for wholesale electricity. This lets you budget on other programs that concentrate on energy efficiency, and bring closer to achieving net zero.

There was a time that PPAs cost more and which made it a difficult choice to make to use PPAs. Presently, PPAs are in line with market prices, making them more appealing, with both added value and benefits. With PPAsyou might be able to establish private wire arrangements that permits you to move renewable energy directly from the generator of the provider to your company. This can reduce the expense associated with having an intermediary utility service, making the PPA more of an expense.

The benefits of additionality

The additionality option has many advantages. It’s a badge of honour that highlights the commitment of your company to creating a sustainable future. It’s also a proactive way to showcase the way to net zero for your company.

It is also possible to make additionality the primary and center of your sustainability plan. As a company you could be proud of your contribution in helping to ensure that renewable energy plants are constructed. It is possible that, without your financial support this plant wouldn’t have been constructed. It’s a powerful narrative and marketing tool, and is a major advantage over your competition.

Green and Additional Green and additional

As we’ve seen, the existing renewable energy supply capacity is in low demand. The businesses that are buying this green energy do not have the effect they would like to. There is a growing idea of a more sustainable green energy that involves actually making an impact by either creating your own energy, or by adding power to the grid. This is a shift away of REGO-backed energy towards on-site power generation and the buying of PPAs.