US clean power procurement skyrockets to historic levels in 2024 led by utilities and C&I
In a new report, American Clean Power Association lauds wind, battery storage, and solar leading a US 'all of the above energy future'
US clean power procurement soared 71% to a historic 62GW in 2024, as utilities led the way amid expectations for significant load growth into next decade, while the technology sector was the top commercial and industrial (C&I) buyer, according to new American Clean Energy Association (ACP) report.
“Solar, wind, and battery storage are leading an all of the above energy future powered by affordable, reliable, and secure American resources,” said CEO Jason Grumet.
Utilities led by Pinnacle West Capital Corporation, parent of Arizona Public Service, accounted for 11 of the top 15 clean energy off-takers.
Amazon was the top off-taker overall with 4.2GW, followed by Pinnacle West (3.3GW), New York State Energy Research & Development Authority (2.8GW), Microsoft (2.6GW), and Berkshire Hathaway Energy.
Of the 48.6GW of clean power projects that began commercial operations in 2024, ACP was able to identify the offtake mechanisms associated with 42.6GW of capacity. The offtake arrangements for the remaining 6GW were unknown.
Power purchase agreements (PPAs) remained the main mechanism for clean power buying, accounting for 61% of all off-take arrangements associated with operational 2024 projects. PPA announcements increased 56% in 2024 to reach 42GW.
Solar PPAs skyrocketed 74% last year, “making the technology the primary driver for the record year in PPA announcements,” according to ACP.
Battery storage continued to expand its share of PPA announcements. Having increased 103% year-on-year, battery storage PPAs represent over 20% of all such off-take deals executed.
It noted growing interest in solar and battery storage reflects cost declines for both technologies as well as recognition that battery storage can play a role in extending the output of solar power throughout the day.
In contrast, PPAs for land-based wind capacity fell by 8% in 2024.
Direct use of utility-owned clean energy assets was the second most common type of off-take, representing 14% of deals, followed by merchant agreements (5%), REC/OREC contracts (3%), resource adequacy contracts (3%), and community PPAs (1%).
A REC [renewable energy credit] or OREC [offshore wind REC] represents the clean energy attributes of 1MWh of renewable power.
Of the 174GW of clean power capacity under construction or in advanced development at the end of 2024, ACP was able to determine the offtake mechanisms for 136.5GW.
Mechanisms were power purchaser agreements, followed by direct utility ownership (11%), REC/OREC agreements (7%), merchant (4%), and resource adequacy contracts (2%). Community PPAs and hedge agreements were less than 1%.
Overall, utilities were counterparties for 75.6GW of clean energy capacity in the pipeline at the end of 2024, compared to C&I customers, which accounted for 28.2GW of contracts.
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