BEYONDTHEMEGAWATTOPTIMIZINGIMPACTOFCLEANENERGYPROCUREMENT:GrowingDemandforSocialandEnvironmentalOutcomesAUGUST2023TABLEOFCONTENTS3ExecutiveSummary4Acknowledgments4Notefromauthors5Introduction6Definingnoncommercialcriteria8ValueofBTMattributestoenergycustomers10Stateoftheenergy-customer-ledcleanenergytransition11ArecompaniesinterestedinBTMattributes?15AredevelopersinterestedinBTMattributes?17WhichBTMattributesarecriticaltocustomersanddevelopers18Recommendations22Closingremarks23Appendix24Glossary3EXECUTIVESUMMARYTheU.S.,alongsideothercountries,ismakingsignificantprogressindeployingcleanenergyamongpowercapacityadditionsastheglobaltransitiontocleanenergyadvances.TheU.S.EnergyInformationAdministrationforecaststhat,in2023,82%1ofthenewutility-scalegeneratingcapacityproposedfordeploymentintheU.S.willbecleanenergy.Energycustomersandtheirpartnersarecriticalstakeholdersinthisevolution,voluntarilyprocuringover68gigawattsofnewcleanenergycapacityintheU.S.since2014.2However,notallcleanenergyiscreatedequal.Leadingcustomersanddevelopershaveachancetoacceleratemarketconditionstocatalyzeprojectsthatbroadlysupportclimate,conservation,andcommunityvalueswhiledeliveringresilientnewcleanenergyprojects.Incentivesofferedthroughlegislation,suchastheU.S.’sInflationReductionActandInfrastructureInvestmentandJobsActandtheEuropeanUnion’sREPowerEUplan,havecreatedevenmoreurgencytoacceleratethecleanenergytransition.Considerationofenvironmentalandsocialco-benefits(BeyondtheMegawatt[BTM]attributes)incleanenergyprocurementcanhelpglobalcorporateenergycustomersmeettheirsustainabilityandbroaderenvironmental,social,andgovernancegoals(ESG),enhancebrandvalue,improvecompetitiveadvantage,andmitigateoperationalandreputationalrisks.Manycleanenergycustomersanddevelopersarealreadymaximizingthesocialandenvironmentaloutcomesofnewcleanenergyprojects.Over60%ofU.S.-basedcorporateenergycustomersanddevelopersparticipatinginarecent2023studybyTheNatureConservancy(TNC),theCleanEnergyBuyersInstitute(CEBI),andBain&Companystatedthattheybelievethisapproachwillbethenewstandardinthenextfiveyears.Moreover,corporateenergycustomersexpressedanincreasedwillingnesstopayforprojectsthatembedsocialandenvironmentaloutcomes,whiledevelopersexpressedadesiretoreceivepreferentialtreatmentfromcustomerstoexecutethesetypesofprojectsmoreconsistently.Opportunitiesexistforcollaborationtoincentprojectsthatmaximizesocialandenvironmentalvaluesby:•RaisingawarenessofthevalueofBTMattributesamongbothinternalandexternalstakeholders•Evolvingcleanenergyprojectdevelopmentandprocurementprocessestoprioritizesustainability,resilience,andequityattributes•DevelopinganindustrystandardtoembedBTMattributesincleanenergyprojectswithbroadsupportfromimportantclimate,conservation,andcommunitystakeholders•Monitoringmarketreadinessforacertificationtoverifythesocialandenvironmentalimpactsofanewcleanenergyprojectalignedtoindustrystandards•AdvocatingforregulatorypolicyandlegislationthatincentivizesadoptionofBTMprinciplesforpurpose-drivenenergyprocurementacrossthecleanenergysectorTNCandCEBIcontinuetopartnertoraiseawarenessaboutthepositiveimpactscleanenergycanhaveonpeopleandplanetandtheroleenergycustomersandproviderscanplayinmaximizingthoseimpacts.Inearly2023,thetwoorganizations,alongwithBain&Company,conductedaresearchprojecttounderstandtheenablingfactorstoacceleratecleanenergydeploymentatthepaceandscalenecessarytoaddresstheclimatecrisiswithoutrepeatingsignificantinjusticesofpriorenergytransitions.Thispapersharesthoseresearchfindingsanddetailsfourspecificactionsthatcleanenergycustomers,developers,andotherstakeholdercantakeintheupcomingyearstoencourageadoptionofBTMprinciples.1U.S.EnergyInformationAdministration.(2023,March6).Wind,solar,andbatteriesincreasinglyaccountformorenewU.S.powercapacityadditions.https://www.eia.gov/todayinenergy/detail.php?id=557192CleanEnergyBuyersAssociation.(2022).CEBAdealtracker[Dataset].https://cebuyers.org/deal-tracker/4ACKNOWLEDGMENTSTheleadauthorsofthiswhitepaperareMirandaDomico,renewableenergymarketsassociateatTheNatureConservancy;OrnellaNicolacci,directoroftheTransactionAccelerationGroupatCleanEnergyBuyersAssociation;andBernhardMarschitz,partneratBain&Company.TheycanbereachedatatMiranda.Domico@tnc.org,ONicolacci@cebuyers.org,andBernhard.Marschitz@Bain.com.ContributingauthorswereNathanCummins,GreatPlainsrenewableenergystrategydirectoratTheNatureConservancy;MonicaJaburg,DirectorofStrategicCommunicationsandSofiaMongeon,SeniorCoordinate,TransactionAccelerationGroupwiththeCleanEnergyBuyersAssociation;CynthiaTassopoulos,Bain&Company;andAvnishKumar,Bain&Company.TheauthorswouldliketothankRupakThapaliyaandPhoebeRomeroatCleanEnergyBuyersAssociationandErinBrousseauatConvergeStrategiesforreviewingconceptsinthispaperandprovidinginvaluableinput.NOTEFROMAUTHORSThispaperaimstoraiseawarenessofthevalueofembeddingenvironmentalandsocialconsiderationsduringcorporatecleanenergyprocurement.TheprinciplesputforthherebuildupontheCleanEnergyBuyersInstitute’sBeyondtheMegawattinitiativeandtheBeyondCarbon-Free,MoreThanaMegawatt,andPowerwithPurposepaperspreviouslypublishedbyTheNatureConservancyincollaborationwithmarketpartners.ThispaperisaculminationofaresearchprojectconductedfromJanuarytoApril2023bytheCleanEnergyBuyersInstitute,TheNatureConservancy,andBain&Company.Aspartoftheproject,twosurveyswerelaunchedtogatherperspectivesfromcorporateenergycustomersandcleanenergydevelopers:80EnergyCustomerSurveyPROFESSIONALSRESPONSIBLEFORCLEANENERGYPROCUREMENTWITHINAVARIETYOFCORPORATIONS41EnergyDeveloperSurveySTAKEHOLDERSWHOPLAYANINTEGRALROLEINTHEDEVELOPMENTANDSUPPLYOFCLEANENERGYThesurveyresultsweresupplementedwithabout30one-on-oneconversationswitharepresentativesampleofkeyenergycustomers,developers,investors,andserviceproviderstoinformthefinalrecommendations.Thispaperhopestoadvancelearningandcollaborationacrosstheindustryandaccelerateaclean,green,andequitableenergytransition.5INTRODUCTIONAmajortransitionfromfossil-basedenergygenerationtocleanenergygenerationisoccurringthroughouttheworld.Localandnationalgovernments,corporations,andotherorganizationsaretakingtheleadintheirownwaystoacceleratethistransition—andsettingincreasinglyambitiousgoalsarounddecarbonization.Governmentsareusingacarrot-and-stickapproachbycreatingfinancialincentivesfordeveloperstobuildoutenergyinfrastructurethatwillgenerate,transmit,anddeliverlow-carbonelectricityaswellassettinggenerationmixmandates.Energycustomersandtheirpartnershaveplayedacriticalroleindrivingtheevolutionoftheenergymarketaroundtheglobebyvoluntarilyprocuringnewcleanenergycapacity.IntheU.S.alone,thiscapacityamountstoover68gigawatts(GW).3Thishasbeenaccomplishedeitherdirectly,byenteringintoPowerPurchaseAgreementsorVirtualPowerPurchaseAgreementstoofftakeenergyforlongperiods,orindirectly,bypurchasingfinancialinstrumentssuchasEnvironmentalAttributeCertificates.IntheU.S.,therecentlypassedInflationReductionAct(IRA)andInfrastructureInvestmentandJobsAct(IIJA)aresuperchargingthecleanenergyindustrybyallocatingapproximately$430billionintaxcreditsandloanstowardthedevelopmentofcleanenergygeneration.AnalystsestimatethattheIRAcanhelpincreaseannualcleanenergycapacityadditionsbyuptofivetimesthatofpre-IRAlevels.4AstheIRAandcomparableglobalinitiativesacceleratecleanenergydevelopment,itisvitalthatthistransitionawayfromfossil-basedenergyisexecutedswiftlyandintentionally,directingasmuchsupportaspossibletohostcommunitiestoensureajusttransition.Cleanenergydevelopmentprocessesneedtomaturetoreduceexisting,andattimesevolving,barrierstoensurethattheclimatebenefitsoftheIRAandotherpolicyinitiativesarerealized.Forexample,aforthcomingstudybyresearchersfromtheNationalRenewableEnergyLaboratoryfindsasignificantnumberofrestrictiveordinancesforwindandsolaracrosstheU.S.,includingasixfoldincreaseinrestrictivewindordinancesfrom286in2018to1,853in2022.5Procurementapproachesmustbeupdatedtoachieveclimategoalsandensureaninclusivelensistakentomaximizeenvironmentalandsocialoutcomes.Acontinuousimprovementmindsetisnecessarytoensurethatthecleanenergymarketmaturationoptimizesforpeopleandplanet.Aspublictrustinbusinesshitsanall-timehigh6andexpectationscontinuetoincreasefortheprivatesectortoleadonsocietalissueslikeclimateaction,theroleofenergycustomersinthecleanenergytransitionismorecriticalthanever.Leadingenergycustomeraretakingactionthroughholisticprocurementapproacheswithcriteriathatprioritizeenvironmentalandsocialoutcomesduringdesign,development,deployment,operationsanddecommissioningofcleanenergyprojects.TheNatureConservancy(TNC),theCleanEnergyBuyersInstitute(CEBI),andBain&CompanyinitiatedtheEnergyCustomerandPartnerProjectSurveystoquantifythegrowinginterestinfinancialattributesandtopresentnear-termactionsthatenergycustomersandtheirpartnerscantakethroughprocurementprocessestoadvanceajustcleanenergytransition.3CleanEnergyBuyersAssociation.(2022).CEBAdealtracker[Dataset].https://cebuyers.org/deal-tracker/4Jenkins,J.D.,Mayfield,E.N.,Farbes,J.,Jones,R.,Patankar,N.,Xu,Q.,&Schivley,G.(2022).Preliminaryreport:TheclimateandenergyimpactsoftheInflationReductionActof2022.REPEATProject.https://repeatproject.org/docs/REPEAT_IRA_Prelminary_Report_2022-09-21.pdf5Lopez,A.etal.Forthcoming.LandHo!HowSitingOrdinancesImpactLandAvailabilityforWindandSolarDevelopment6Edelman.(2022).Edelmantrustbarometer2022.https://www.edelman.com/trust/2022-trust-barometer6DEFININGNONCOMMERCIALCRITERIABeyondtheMegawatt(BTM)considerationsarethenoncommercialcriteriaofacleanenergyprojectthatgobeyondpriceandcontractterms,includingthefollowingcategories:BEYONDTHEMEGAWATTATTRIBUTESCLIMATE,CONSERVATION,&SUSTAINABILITY1Theall-incarbonfootprintofanewcleanenergyproject,potentialimpactsonbiodiversity(e.g.,wildlife,habitat),andend-of-lifemanagementCOMMUNITYENGAGEMENT&SOCIALEQUITY2Impactofnewcleanenergyprojectsonlocalcommunitiesupstreamanddownstream;workforce;andprogressondiversity,equity,inclusion,andjusticegoalsENERGYGENERATIONRESILIENCE3Reliabilityandlongevityofanewcleanenergyproject;resilienceofthegrid,communities,andsupplychainsEachcategoryhasmultipleattributeswithavarietyofimpactsthatenergycustomersandtheirpartnerscanoptimizeinanygivencleanenergyproject.TheCEBI’sBeyondtheMegawattinitiative,alongwithcomplementaryframeworks,detailattributesinformedbydeepindustrystakeholderengagementandresearch,asshowninFigure1.BTMattributesarewellalignedtotheINSIGHTSFROMTHEMARKET:Climate,Conservation,andCommunities(3C)frameworkbroughtforwardbytheInone-on-oneconversations,energycustomers,BeyondCarbon-Freepaperdevelopedbydevelopers,andprovidersacknowledgeditTNC,TheNationalAudubonSociety,andmaynotbefeasibletohaveaprojectorevenLevelTenEnergy.The3CframeworkisaportfoliothatmeetseveryattributelistedindemonstratedinotherindustryleadingFigure1.Manycustomerssaidtheyoftenoptimizeefforts,suchasSalesforce’scatalyticforasubsetofattributes,informedbytheirMoreThanaMegawattwhitepaperandcorporategoalsandtheproject’scharacteristics.purpose-focusedcommitmentsfromDeveloperssimilarlynotedrealbarrierstobeingmajorcleanenergycustomerssuchabletoincorporatemultiplenoncommercialasGoogle,Microsoft,REI,Rivian,andattributesintonewprojects.Walmart.TheseeffortsreinforcethepivotalroleofcleanenergycustomersinUltimately,customers,developers,andprovidersrealizingthecommunities,conservation,alikeadvocatedformaximizinginclusionofandclimatebenefitstheirprocurementBTMprinciplesforpurpose-drivenenergycanproducethroughtheintegrationofprocurementwhiletakingapragmaticapproachBTM."ValueofBTMAttributestoEnergytoensurethisfocusdoesnotcomeattheCustomers"onpage8exploresadditionalexpenseofthecleanenergytransition.tangiblebenefitsforenergycustomers.7Climate,Conservation,CommunityEngagementEnergyGeneration&Sustainability&SocialEquityResilienceWildlife&habitatimpactImpactonlocalcommunityOperationalresiliency(e.g.,impactonbaldeagles,(e.g.,healthimpact,engaging(e.g.,on-sitecleangeneration)activitiesimpactingwetlands)localcommunity’sparticipation,visualimpactfromwindmills)ImpactonlocalagricultureWorkforcestandards&usageofSupplychainprocurementrisks(e.g.,impactonsoilhealth,local,diverselabor(e.g.,embargos,naturalevents-displacementofarableland)(e.g.,prevailingwages,DEI-alignedrelateddisruptions)recruitmentprocessforstaff)EnvironmentalimpactofHumanitarianimpactoftheImpactofprojectonnearbytheupstreamsupplychainupstreamsupplychaingridquality(e.g.,environmentalimpactof(e.g.,usageofchildorforced(e.g.,measurestominimizeextractingrawmaterialsandlaborinmining)additionalburdenongrid,manufacturingofproducts,advancedpowerplantcontrolsuseoflow-carbonmaterials)andgridintegrationsolutions)ProjectsitecarbonOngoingtalentdevelopmentImpactontransmissioncapacityfootprintimpact(e.g.,solarenergytraining(e.g.,optimizingexistingregional(e.g.,impactonorlossofprogramforlocallaborforce)transmissioninfrastructureandforestedlands,developingavoidingcongestedcorridorsorprojectsinenergycommunities)upgradestoexistinglines)End-of-liferecyclingImpactontriballandsorPreventivemeasuresagainstanddisposalotherculturallysensitiveareasunauthorizedinterference(e.g.,howwindandsolar(e.g.,culturalartifactreview(e.g.,localprotests,vandalism)productswillbemanagedatendstudies)oflife,contractingwithsuppliersparticipatingintake-backprograms)ReturnlandtoitsoriginalorUtilizinglocaland/orLong-termviabilityofnewalternativeuseatendoflifediversesuppliersprojectsandtheenergysystem(e.g.,reforestation)(e.g.,parts,maintenance,and(e.g.,resiliencetoclimatethreats)otherservices)CarbonintensityofImpactonhistoricallyRight-sizedcleanbackupgenerationdisadvantagedcommunitiesbackupgeneration(e.g.,useofclean-energy-(e.g.,cleanenergyaccess,(e.g.,cleaneralternativestopoweredbackupgenerators)economicopportunitiesdieseltomaintaincriticalthroughinclusiontargets)functionsthroughdisruptions)Figure1:Anon-exhaustivelistofBTMattributesthatcanhaveavarietyofimpactsonanewcleanenergyproject8VALUEOFBTMATTRIBUTESTOENERGYCUSTOMERSByembeddingBTMattributesaspartofacleanenergyprocurementstrategy,cleanenergycustomerscan:Speedupthecleanenergytransition.Fewerthanone-fifthofsolarandwindproposalsactuallymakeittocompletion,mostlyduetogridinterconnectionandlocalpermittingissues.Studieshavefoundthatdevelopingcleanenergyonlow-biodiversitylandcanresultinafasterpermittingtimeline,anddeveloperswithastrongequityfocusmayfacelessresistancefromlocalcommunitiestobuildprojects.Asaresult,customerscanhelpspeedupthecleanenergytransitionbyconsideringBTMfactorstoevaluatetheenvironmentalandsocialroadblocksaprojectmayface.Meetbroadercorporategoals.TheMorningstarCorporateESG2022reportshowsthat90%ofcompaniestodayhaveoraredevelopingaformalstrategytomanagecorporateESGpractices.Maximizingtheco-benefitsofcleanenergytransactionscanhelpcorporationsachievetheirESGgoalsfasteranddemonstratecorporatecontributiontotheUnitedNationsSustainableDevelopmentGoals,DecadeonEcosystemRestoration,andGuidingPrinciplesonBusinessandHumanRights.Supportstrongerfinancialperformance.Anassessmentofmorethan1,000researchpapersbytheNewYorkUniversitySternCenterforSustainableBusinessandRockefellerAssetManagementfoundthat58%ofthe“corporate”studiesthatfocusedonoperationalmetrics,suchasreturnonequity,returnonassets,orstockprice,foundapositiverelationshipbetweenESGandfinancialperformance.Institutionalinvestorsarealsoincreasinglyusingsocialandenvironmentalimpactasaframeworkforevaluatingfinancialriskandopportunities.Mitigateoperationalandpublicrelationsrisks.Takingproactiveactionstowardaresilientenergysupplypreparesbusinessesformorefrequentextremeclimateevents.Havingacomprehensiveframeworktoevaluatesocialandenvironmentalattributeswillalsohelpcorporationsavoidanypotentialpublicrelationsrisksfromecologicalcalamitiesorenvironmentalinjustices.9Acquireandretaintalent.Thenextgenerationoftheworkforceincreasinglyexpectstheiremployerstohavestrongenvironmentalsustainabilitystandards.A2022YaleCenterforBusinessandtheEnvironmentsurveyofmorethan2,000globalbusinessstudentsfoundthataboutthree-quartersofrespondentsbelievecompanieshaveanequal,ifnotevenbigger,responsibilitythangovernmentstomeetsocialandenvironmentalchallenges.About51%arewillingtoacceptalowersalarytoworkforacompanywithbetterenvironmentalpractices,and26%wouldnotacceptajobatacompanywithpoorpractices(upfrom19%in2015).Asthisdatasuggests,demonstratingcorporatecontributionstonatureandsocietycanhelpattractandretaintalent.Strengthenstakeholderrelationships.Consumerstodayexpectcorporationstobeaforceofchangeforthegreatergood.Usingenergyprocurementasamechanismtoimproveoursocietyandenvironmentcanenhanceacorporation’sbrandvalueandstrengthenitsrelationshipswithcustomers,investors,andsuppliers.A2017ConeCommunicationscorporatesocialresponsibilitystudyfoundthat87%ofsurveyedconsumersmakepurchasingdecisionsbasedonvalues,76%willboycottbasedonvalues,and88%aremoreloyaltothecompanywhenitsupportsasocialorenvironmentalissue.Improvecompetitiveadvantage.Accordingtoa2020HarvardBusinessReviewarticle,companiesthatimprovedonmaterialESGissuessignificantlyoutperformtheircompetitors.Asthenextfewsectionshighlight,mostcorporatecustomersexpecttoincorporateBTMattributesforasignificantportionoftheircleanenergyinthenextfiveyears.Companiesthatwanttostayaheadofthecompetitioncandistinguishtheirpositionasindustryleadersbybecomingearlyadopters.Makecomplianceprocesseseasier.Adoptinganimpactframeworktoprocurecleanenergywillhelpcompaniescomplywithregulations,suchastheU.S.Dodd-FrankActandtheUyghurForcedLaborPreventionAct.CompaniesoperatingacrosstheAtlanticmayfindthathavingahigherstandardofenergyprocurementmayhelpmaintaincompliancewithEuropeanUnioncleanenergytargets.10STATEOFTHEENERGY-CUSTOMER-LEDCLEANENERGYTRANSITIONPercentageofcustomersbytheirorganization’scurrentcleanenergygoals100%N=80Ofthe80EnergyCustomerSurveyparticipants,over80%Become24/7carbon-freeofrespondingcompaniesindicatedtheyhaveestablishedspecificcarbonreductiongoalsasshowninFigure2.Becomecarbon-free/Energycustomershavevoluntarilyadvancedthecleancarbon-negativeenergytransition,resultinginarecord20GWofcontractedcleanpowerin2022—representinga100X80%increasesince2014.760%Becomecarbon-neutralFigure3highlightsthekeydriversbehindenergygoalsestablishedbysurveyparticipants.Responsessignal40%thevariousinternalandexternalstakeholdersenergycustomersshouldconsiderduringthegoal-settingReduceorganization'sprocesstoensurecleanenergysolutionssupportbroadercarbonfootprintcompanycommitments.20%WHATISDRIVINGACLEANENERGYTRANSITIONAMONGCORPORATIONS?Org.hasyettosetspecificgoals58%0%NocleanenergytransitionoftheEnergyCustomerSurveyrespondentssaidthattheircompany’sbroadercorporateaspirationsaredrivingCleanenergytransitiongoalstheircleanenergytransition(Figure3).Morethan40%ofFigure2:therespondentsexpressedexternalpressuresasamajorCleanenergytransitiongoalsreasonforcleanenergygoals.TheseexternalpressuresSource:EnergyCustomerSurveycantaketheformofcompetitive(dis)advantage,investorrequirements,andreputationalrisk.Inlinewithcorporateaspirations58%Percentageofcustomerswhoranked49%thesecleanenergytransitionFuture-proofbusiness42%driversintheirtopthree42%Competitivepressureonclimatetargets41%Investorrequirements23%40%60%17%Reputationalriskmanagement14%6%Regulatoryrequirement20%Employeeacquisition/retentionSupplychainriskmanagementCivilsociety/mediapressure0%Figure3:Topreasonsforcustomer'scleanenergytransitionSource:EnergyCustomerSurvey7CleanEnergyBuyersAssociation.(2022).CEBAdealtracker[Dataset].https://cebuyers.org/deal-tracker/11ARECOMPANIESINTERESTEDINBTMATTRIBUTES?TheEnergyCustomerSurveyaskedaboutcurrentandexpectedinterestinBTMattributes.Morethanhalfofthecustomerssurveyedalreadyconsidersomeattributesduringcleanenergyprocurement,andevenmore(over60%)expectBTMconsiderationstobecomeastandardwayofprocuringcleanenergyfiveyearsfromnow.Theseresultsdemonstrategrowingmomentumamongcorporateenergycustomerstowardamoreinclusiveprocurementstrategy.However,asdiscussedinthepriorsection,noteverycompanyisinthesameplacewiththeircleanenergyjourney.Forthisreport,surveyedcorporatecustomersintheU.S.werecategorizedintothefollowinggroupsbasedontheircurrentconsiderationofBTMattributes,ambitionofcleanenergygoals,andsophisticationofenergyprocurementprocesses:PIONEERSCompanieswithadvancedcleanenergyandESGgoals,includingscience-basedcarbonreductionorcarbon-freeenergygoals.Pioneershavesophisticatedprocurementprocesseswithin-housestandardsthatconsiderESGpriorities,suchasworkforcedevelopment,andactivelyconsiderapplicationofBTMattributesPRAGMATISTSCompanieswithclearandspecificcleanenergyandESGgoalswithmoreincrementalapproaches.Pragmatistsadvancecleanenergyprocurement;however,theyarelesslikelytoconsistentlyconsiderandintegrateBTMattributes,givenlimitedexperienceandcapacity.?PROSPECTIVES?CompaniesthatdonotconsideranyBeyondtheMegawattattributesduringtheircleanenergyprocurement.Prospectivecompaniesarelesslikelytohavesophisticatedprocurementprocessesandwell-definedcleanenergyorESGgoals.ProspectivesrepresentthegreatestmarketopportunitytodriveimpactthroughintegrationofBTMattributes.1280%PIONEERS70%PRAGMATISTSStatethatmostoftheirStatethatmostoftheirfuturecleanenergywillfuturecleanenergywillincludesomeBTMattributesincludesomeBTMattributesN=20N=21N=19N=1881%–100%81%–100%81%–100%100%100%61%–80%PercentofcleanenergyprocuredwithBTMattributes80%41%–60%81%–100%41%–60%PercentofcleanenergyprocuredwithBTMattributes61%–80%80%21%–40%60%21%–40%60%1%–20%61%–80%40%40%41%–60%41%–60%20%1%–20%20%0%21%–40%21%–40%0%0%1%–20%0%1%–20%Today5yearsfromnowToday5yearsfromnowResponsesthatdon’tuseanycleanenergytodayorreported“Idon’tknow”excludedFigure4:CurrentandexpectedinclusionofBTMattributesSource:EnergyCustomerSurveyAsshowninFigure4,theEnergyCustomerSurveyfoundthataboutone-fifthofPioneersandPragmatistscurrentlyprocureaportionoftheircleanenergywithBTMattributes(i.e.,40%ormoreoftheirtotalcleanenergyconsumption).However,fiveyearsfromnow,mostPioneersandPragmatistsexpecttheywillprocureasizableportionoftheircleanenergywiththeseattributes.ThisexpectedgrowthininclusionofBTMattributesshouldactasaclearandstrongsignaltotheindustrythatincorporatingBTMprinciplesincleanenergyprojectscouldbebusinessasusualinthenearfuture.INSIGHTSFROMTHEMARKET:Inone-on-oneconversations,corporateenergycustomersrepeatedlyvoicedtheirinterestinprocuringcleanenergywithtangibleimpactstories,givennewcommitmentsandrisingpublicattentiononESGtopics.Yetmanycustomerssaidtheythinkaboutenergyprocurementandconsumptionfromaportfolioperspective,whichchallengestheirabilitytoconsistentlyprioritizeBTMattributes.EvenPioneersnotedtheymaypursuetheseattributesinonlyaportionoftheirtotalenergyportfolioastheybalanceotherpriorities,suchascost,location,andgeneration.13Pioneers/Pragmatists:ImpactstoryandcorporateaspirationsasprimaryvaluedriversPercentageofrespondentswhofind100%91%PIONEERSdriverasvaluabletoday(N=41)PRAGMATISTS80%79%64%58%50%53%53%55%60%41%41%40%37%20%26%32%26%0%InlinewithProvidesbetterDemandfromInvestorPotentialEmployeeRegulatoryourbroaderimpactstorycustomers/requirementforfinancialacquisition/requirementemployees/incentives(e.g.,corporatepublictaxbenefits)retentionaspirationsFigure5:WhyPioneersandPragmatistsfindBTMattributesvaluableSource:EnergyCustomerSurveyOver90%ofPioneerand79%ofPragmatistcompanyrespondentsintheEnergyCustomerSurveyidentifyBTMattributesasanextensionoftheirorganization’sbroadergoals(Figure5).Respondentsvaluetheresultingimpactstoriesthathelpbuildreputationalvaluethroughindustrypositioningandsupportinternaleffortstoinspireemployees.IntegrationofBTMattributescanalsohelpmeetinvestorexpectationsandsupportcost-competitiveapproachesbyusingavailabletaxincentives.CurrentlegislationshouldenableBTM-focusedprojectstobecomeincreasinglycostcompetitiveinthecomingyears.AsFigure6shows,nearly80%ofthecompanies70%PROSPECTIVEScategorizedasProspectivesexpressedthatBTMInterestedincleanenergyattributesarenotapriorityandcurrentlynotintegratedwithBTMattributes5yearsintheirprocurementprocesses.ProspectivesindicatefromnowthegreatestbarriertointegrationofBTMattributesisthegapinabilitytoreceivecreditandaccountfortheir100%N=37N=37utilization.However,thesecustomersexpresshigh5-Ext.int.interestinprocuringcleanenergywithBTMattributes5-fiveyearsfromsignalingagrowingawarenessofevolving4Extremelyindustrystandards.interestedArecustomerswillingtopayforPercentageofProspectivesbyinterest80%BTMattributes?inprocuringcleanenergywithBTM3Oneconcernvoicedbyenergydevelopersinone-on-oneconversationswasthatcustomers’interestinBTM60%4attributesdoesnotnecessarilysurfaceintheprojectselectionprocessandspecificallydoesnottranslateinto40%aclearwillingnesstopayfortheseattributes.TheEnergyCustomerSurveyfoundthatcustomers2signalamoderatewillingnesstopayforBTM20%3attributes,rangingfrom,onaverage,4%amongProspectivesto9%amongPioneersabovewhat1-Notatall2customerspaytodaypermegawatthour(MWh)forclean0%interestedenergy.AsFigure7shows,asmallsubsetofPioneers,5yearsfromnowPragmatists,andevenProspectivesdemonstratesaTodaysubstantiallyhigherwillingnesstopaymorethan11%abovetheircurrentcleanenergycost.Figure6:InterestinBTMattributesamongProspectivesSource:EnergyCustomerSurvey14INSIGHTSFROMTHEMARKET:“Mostbuyersdon’tgointothesedealswantingtolosemoney.BuyersarelookingformoreneutraleconomicsEnergycustomersnoteditisdifficultaslongasthestorylinesupwiththeirneeds."toconsistentlypaymoreforBTMattributesacrosstheirportfolioorfor–Cleanenergyserviceproviderallenergysources.However,somePioneershavebeenabletoprocure“Ourwillingnesstopayfortheseattributesshiftsaround.projectswithBTMattributeswithoutWemayonlypaymoreifthereisanexplicitgoalwe’veincreasingcosts.Therefore,bothenergymadearoundDEIandorESGmetrics.Thestoryneedstocustomersandprovidersanecdotallybestrongenoughtowarrantthecost,butthisisprovinghavesaidwillingnesstopaymaybedifficultintoday’s[economic]environment.”moresituational:basedontheprojectathand,organizationalgoals,andeven–Pioneerenergycustomerthebroadereconomicenvironment.Percentageofrespondentsbywillingnesstopay100%9%PIONEERS7%PRAGMATISTS4%PROSPECTIVESabovewhattheypaytodayforcleanenergy80%60%WeightedaverageWeightedaverageWeightedaverage40%ofwillingnesstopayofwillingnesstopayofwillingnesstopayN=22N=19N=3716%+16%+8%–10%11%–15%11%–15%4%–7%8%–10%8%–10%1%–3%4%–7%20%4%–7%1%–3%0%0%1%–3%0%PioneersPragmatistsProspectivesFigure7:WillingnesstopayforBTMattributes.WeightedaveragecalculatedbytakingthemidpointofeachrangeSource:EnergyCustomerSurveyDifferencesdoexistinwillingnesstopayforBTMattributesbydepartment,frequencyofprocurement,decision-makingauthority,andotherfactors.Forexample,respondentsfromsustainabilitydepartmentstendtociteahigherwillingnesstopaythanrespondentsfromfinancedepartments.ThesedifferencesexistduetoawiderangeinunderstandingthevalueofBTMattributes.AcleardemonstrationofthevalueofBTMattributestoallthestakeholdersinvolvedinenergyprocurementwillhelpensuretheseattributesarevaluedappropriately.INSIGHTSFROMTHEMARKET:EnergycustomershighlightedmultiplebarrierstoeffectivelyincorporateBTMattributesintotheirprocurement,includingalignmentofinternalstakeholdersandacomplexsupplierlandscape.Internally,cleanenergyprocurementleadsmustoftenalignmultiplestakeholderstothevalueofprojectswiththeseco-benefitsamidpotentiallycompetingpriorities.Customers,specificallyPragmatistsandProspectivesthatmaynotfrequentlyprocurethroughbilateralagreementswithproviders,alsociteddifficultynavigatingthecomplexdeveloperlandscape.Whatdoesthismeanfordevelopers?ManyenergycustomerssaidtheywouldbenefitfromdevelopersmoreclearlyhighlightingtheBTMattributesofacleanenergyprojectduringtheprocurementprocess.Developers’abilitytotietheenvironmentalandsocialbenefitsofaprojecttothecorporation’sbroadergoalswouldhelpcustomersbettercommunicatethevaluetheywillreceive(e.g.,expeditedpermitting,reducedprojectcosts,improvedcommunityrelations)iftheyselectthatspecificproject.15AREDEVELOPERSINTERESTEDINBTMATTRIBUTES?Percentageofdevelopersby100%N=41CustomerswillonlybeabletoprocureBTMattributesifthereisalargeBTMconsideration80%Idon'tknowenoughsupplyofprojectsthatdeliverthem.TheEnergyDeveloperSurveyfoundthatmostrespondentsareinterestedinincorporatingtheNoBTMattributesbutfacedifficultiesindoingsointhecurrentmarket.60%Almost70%ofthesurveyeddeveloperssaidtheyalreadyconsidersomeportionofBTMfeaturestoday(Figure8)foravarietyofreasons.40%Someattributes,suchascertainwildlifeimpacts,arerequiredbyamixYesoffederal,state,andlocalagencies.Others(e.g.,useofrawmaterialsminedbychildorforcedlabor)areseenascriticaltomanagea20%developer’sreputationalrisk.0%ManydevelopersalsoseetheseattributesasanintegralpartoftheircorporatevaluepropositionandhavefoundthatconsideringBTMConsiderBTMattributesgivesthemanadvantageovercompetitors.Thisresultsinwinningbidsbysharingamoreimpactfulstorywithcustomers.ItFigure8:criteriatoday?canalsosecurecommunitysupport,resultinginfasterpermitting,andreduceriskbyscreeningoutsitesthatwouldhaveresultedinDevelopers'interestinBTMcontroversyoradditionalcostdowntheroad.attributesSource:EnergyDeveloperSurvey“Ourcorporategoalistobeagoodneighbor.Wewanttocreateasitethatmeetscustomerneedsandavoidsheadachesdowntheroadthatcomefrompermitsandunintendedconsequences.”–Energydeveloperinone-on-oneconversation16Leversthatwillacceleratedevelopers’adoptionofBTMattributes63%PercentageofdevelopersstatingdriverisHigherpricingperMWh80%neededtoaccelerateBTMadoption(N=41)Preferentialtreatmenttocleanenergyprojectswith59%BTMattributesIncreasedfinancial/taxincentives49%Newindustry-widestandardstodefineBTMattributes46%RegulatoryrequirementtoincorporateBTMfactors44%intoenergyprocurementImprovedmarketmechanismtosellBTMattributes34%40%0%20%60%Figure9:Leversthatwillacceleratedevelopers’adoptionofBTMattributesSource:EnergyDeveloperSurveyDespitetheinterestinBTMattributesamongdevelopers,manycitedifficultyinembeddingthemconsistently.Approximately80%ofsurveyedrespondentsestimatedthatincorporatingBTMattributesintoprojectdevelopmentwilllengthenprojectdurationandincreasecosts.However,studieshavealsofoundthatprojectssitedintentionallytoavoidhabitatimpactscanexperiencefasterpermitting,fewerdelays,reducedprojectcosts,andlesscommunityopposition.8DevelopersemphasizethatthemarketislackingconsistentdemandsignalsforBTMattributes.Therearealsodifferencesinwhichattributesmattermosttocustomers.WhenaskedwhatwillacceleratethedevelopmentofcleanenergywithBTMattributes,approximatelytwo-thirdsofthesurveyeddevelopersexpressedadesireforhigherpricingfromcustomerstorecouptheanticipatedadditionalcostandinterestinpreferentialtreatmentevaluationfromcustomersduringtheselectionprocess(Figure9).NearlyhalfalsoseekclarityonwhichBTMattributesmatterthemostandhowthoseattributesaredefined.About46%ofsurveyeddevelopersdirectlycitedindustry-widestandardsasapotentialmechanismtoachievethisgoal.Overall,developersseevalueinBTMattributesandareinterestedinmaximizingthesocialandenvironmentaloutcomesoftheirprojects.INSIGHTSFROMTHEMARKET:Developersconsistentlymentionedtheycanbettermeetcustomerneedsindustry-wideiftheyseeaconsistentandideallystandardizedsetofattributesrequestedbycustomers,evenfromPioneercustomers.8Dashiell,S.,Buckley,M.,&Mulvaney,D.(2019).Greenlightstudy:Economicandconservationbenefitsoflow-impactsolarsitinginCalifornia.ECONor-thwestandTheNatureConservancy.https://www.scienceforconservation.org/products/green-light-study17WHICHBTMATTRIBUTESARECRITICALTOCUSTOMERSANDDEVELOPERS?Customersanddevelopersmayhaveawiderangeofinterestsandprojectfeaturesthattheycareabout—informedbystakeholderinterestandattributesthatcanhelpdrivetheindustryforwardfaster.TheattributesthatrosetothetopacrossbothstakeholdergroupsintheEnergyCustomerandEnergyDeveloperSurveysarelistedinFigure10.NOTEFROMAUTHORS!ItisimportanttonotethatattributesnotlistedinFigure10shouldnotbeinterpretedasnotcriticalforoursocietyandenvironment.Rather,theseanswersmayreflectalackofawarenessamongrespondents.Thelistbelowsimplyrepresentstheprinciplesthatarebestunderstoodandembeddedinprojectstoday.CLIMATE,CONSERVATION,ENERGYCOMMUNITYENGAGEMENTANDSUSTAINABILITYRESILIENCEANDSOCIALEQUITYWildlifeandhabitatimpactOperationalresiliencyWorkforcestandardsanduseoflocal,diverselaborEnvironmentalimpactofLong-termviabilityofnewImpactonupstreamsupplychainprojectsandtheenergysystemlocalcommunitiesProjectsitecarbonSupplychainfootprintimpactprocurementrisksFigure10:BTMattributesthatrosetothetopacrosssurveyedenergycustomersanddevelopersSource:EnergyCustomerSurvey,EnergyDeveloperSurvey18RECOMMENDATIONSAdvancementofBTMattributesrequiresbroadactionsfromawiderangeofindustryandnonindustrystakeholders.Energycustomers,developers,serviceproviders,governments,andadvocatescanallhelpadvanceprocurementthatispurposedriven.ThefollowingrecommendationsprovideaninitialroadmapformarketstakeholderstomaximizeandaccelerateadoptionofBTMattributesamidtheongoingenergytransition.Eachactionincludesadescriptionofindustry-levelrecommendationsaswellasconcreteandmeasurableactionscustomersanddeveloperscantakeinthenearterm.Action1:RaiseawarenessofthevalueofBTMprinciplesamonginternalandexternalstakeholdersAction2:Evolvecleanenergyprojectdevelopmentandprocurementprocesses,includingsustainability,resilience,andequityattributes,anddevelopanindustrystandardasmarketbuy-inandresourcesbecomeavailableAction3:MonitormarketreadinessforacertificationtoverifythesocialandenvironmentalimpactsofanewcleanenergyprojectalignedtoindustrystandardsAction4:AdvocateforregulatorypolicyandlegislationthatincentivizeadoptionofBTMattributesacrossthecleanenergysectorAction1:RaiseawarenessofthevalueofBTMprinciplesamonginternalandexternalstakeholders.Buildingawarenessisanimportantfoundationalstepfortheindustry,especiallythroughpeer-to-peerlearningexchangesbetweenPioneer9andProspective10energycustomers,asthereisagapinunderstandingthevalueofenvironmentalandsocialconsiderationsincleanenergyprojects.Energycustomersanddevelopersexpressedintheenergysurveysthatraisingawarenesscanbuildexternalpressure(throughinvestors,customerpreferences,orcompetitors)fortheadoptionofBTMattributes(Figure11).Attheindustrylevel,therearefourbroadleversthatcanbepulledtoraiseawareness:•Awardstorecognizeachievements100%90%93%90%80%74%onBTMattributes60%Percentageofrespondentswho78%•Industryeventstohaveanopenindicatescenariowouldincrease65%dialoguewithstakeholderstosharethelikelihoodofadoption40%benefitsofconsideringBTMoutcomesCustomersandtoheartheirperspectives20%(N=80)•Whitepapers,publications,andCustomers0%procurementguidancetosummarize(N=41)industry-widefindingsandeducateInvestorsexpectShiftincustomerCompetitorsstakeholdersonbestpracticesinclusionofBTMdemand/increaseusage•TargetedengagementtoactasFigure11:preferencesofBTMaresourcehubandhelpstakeholdersincorporateBeyondtheMegawattIncreaseinlikelihoodofBTMwiththepresenceofvariousexternalpressureconsiderationsSource:EnergyCustomerSurvey,EnergyDeveloperSurvey9CompanieswithadvancedcleanenergyandESGgoals,includingscience-basedcarbonreductionorcarbon-freeenergygoals.Pioneershavesophisticatedprocurementprocesseswithin-housestandardsthatconsiderESGpriorities,suchasworkforcedevelopment,andactivelyconsiderapplicationofBTMattributes.10CompaniesthatdonotconsideranyBTMattributesduringtheircleanenergyprocurement.Prospectivecompaniesarelesslikelytohavesophisticatedprocurementprocessesandwell-definedcleanenergyorESGgoals.ProspectivesrepresentthegreatestmarketopportunitytodriveimpactthroughintegrationofBTMattributes.19EnergyCustomer&DeveloperCallstoActionIntandemwithindustry-levelprogress,individualenergycustomersanddeveloperscantakeactionintheimmediatetoneartermtobuildBTMawarenessforBTMattributes:•Deepenyourorganization’sinternalunderstandingofthevalueofBTM.Energydevelopmentandprocurementprocessesarecomplexandrequirebuildingacoalitionamongmanyinternalstakeholders.Cleanenergyadvocatescansharepublications,reports,andotherthoughtleadershiponthevalueofBTMattributesinternallytoincreaserecognitionoftheirvalue.Focusingoninformingkeydecision-makerscanleadtogreaterconsiderationofsocialandenvironmentalfactorsinfuturecleanenergyprojectdevelopmentandprocurement,aswellasinorganizationaladvocacyefforts.•SharebenefitsandencourageexternalstakeholderstoadoptBTMattributes.PubliclysharingBTMcommitmentsandsuccessstories,whetherlargeorsmall,canbeaneffectivewayofeducatingcustomers,suppliers,serviceproviders,orotherstakeholdersintheirvaluechain.Transparencyonthekeyattributesthatmattertotheirorganizationmayencourageexternalstakeholderstoadoptthem.Whenpossible,energycustomersanddevelopersshouldconsiderprovidinganongoingattributepreferenceaswellasfinancialandotherincentivestoexternalpartiesandsuppliersthatprioritizeBTMattributes.Action2:Evolvecleanenergyprojectdevelopmentandprocurementprocesses,includingsustainability,resilience,andequityattributes,anddevelopanindustrystandardasmarketbuy-inandresourcesbecomeavailable.AsinterestforBTMprojectsgrows,cleanenergyprojectdevelopmentandprocurementprocessesmustevolve.Inthenearterm,non-priceattributescanbeincorporatedintoindividualcustomeranddeveloperprocurementprocesses.Inthelongterm,amoresophisticatedcleanenergyindustrywithclearstandardsandcommonlanguagecanprovidetheindustry-wideguidancenecessaryforallmarketparticipantstoapplyBTMattributesmoreconsistently.ThepotentialevolutionofvoluntarysolutionsinthecleanenergyindustryisoutlinedinFigure12.SPECTRUM/EVOLUTIONOFVOLUNTARYUpdateprocurementguidelinesSOLUTIONSFORBTMCLEANENERGYtoincorporateBTMattributesLongtermInthenearterm,thereisaneedforadetailedguidancedocumentonNeartermhowtoincludeBTMattributesinprocurementsolicitations(e.g.,alistVoluntaryBTMstandards/BTMofrobustrequestforproposal[RFP]procurementframeworkcertificationquestionswithaclearwaytoscoreguidelinesormeasuretheresponsesforeachwiththatensuresattribute)tohelpmarketparticipantstoguidebuyerstransparent,transparent,shareacommonlanguage.onhowtoindustry-reliable,andincorporateacceptedconsistentCEBI’sBTMinitiativeiscurrentlyBTMintodefinitionsofcertificationofdevelopingaprocurementtoolkittoexistingattributesandBTMattributesprovidesuchguidance,includingaprocurementhowtomeasureforcleanenergylistoftargetedRFPquestions,whichprocessesthemprojectsissettobereleasedin2023.ItwillincorporatetoolsandlearningsfromthePowerwithPurposewhitepaperandatoolkitfromRivianandTNC.Figure12:PotentialevolutionofvoluntarysolutionstosupportandacceleratetheadoptionofcleanenergywithBTMattributes20EnergyCustomer&DeveloperCallstoAction•Wheneverpossible,individualenergycustomersanddevelopersshouldleveragetheguidanceproducedbyCEBI,TNC,andRivian,aswellasanyotherguidancethatisreleasedbycleanenergyadvocatesinthefuture.EnergycustomersexplicitlyrequestingBTMattributeswillprovideacleardemandsignaltodevelopers,givingthemclarityonwhichattributestoincorporateandraisingthebarintheindustry.•EnergycustomersshouldfocusonexplicitlyaccountingfortheincrementalvaluesofBTMattributesoutlinedonpage8(i.e.,riskmitigation,brandvalue,permitting/communitysupport)whenselectingcleanenergyprojectstoprocurefrom.Inaddition,procurementleadscancommunicatethesevaluestointernalstakeholdersandaskdeveloperstoquantifythevalueofBTMattributesintheirproposals.•DevelopersshouldembedBTMattributestothemaximumextentpossibleinprojectdesignanddevelopmentandcommunicatetheirvalueduringthebiddingprocess.•Energycustomersanddeveloperscanleveragepartnershipswithcommunityorganizationsandenergy-orclimate-focusednongovernmentalorganizations(NGOs)forsupportwithvaluatingBTMattributes,creatingaprocurementstrategy,orcompletingprojectduediligence.Longer-termaction:DevelopanindustrystandardforBTMattributesfortheindustryAsvoluntaryprocurementguidelinesgaintraction,themarketshouldleveragethatmomentumtomovetowardastandardizationofBTMlanguageandclearprocurementguidancethatcanbeusedbyallparties.CreatingacommonlanguagetodefineBTMprincipleswillallowindustrymemberstotrackandsharetheirprogress,alignwithbroaderESGgoals,andsimplifysolicitationprocesses.EnergyCustomer&DeveloperCallstoAction•CompaniesthatareinterestedincontributingtothedevelopmentofastandardshouldpartnerwithleadingNGOstoprovidevaluableindustryexperience,guidance,andmarketperspectives.Pursuingpartnershipsandprovidinginputwillhelpensurethatastandardiscreatedwiththeneedsandabilitiesofmarketparticipantsinmind.•CustomersanddevelopersshouldstrivetoaligntheirprocurementprocesseswithastandardasitdevelopstoassistadoptionbyPragmatistsandProspectives.11•Establishgoalsthatalignwiththeevolvedindustrystandardstodifferentiatefromcompetition,motivateemployees,andsignalconvictioninBTMattributestoabroadersetofstakeholders(e.g.,investors,customers,suppliers).Action3:Monitormarketreadinessforacertificationtoverifythesocialandenvironmentalimpactsofanewcleanenergyprojectalignedtoindustrystandards.Anindustry-acceptedBTMstandardwillhavethepotentialtoevolvetowardacertificationmodel.Ifthemarketmovesinthisdirection,acertificationprogramwillbuildtrustthatallprojectsareevaluatedwiththesamerigorandwillprovideatangiblemechanismforenergycustomersanddeveloperstodemonstratethepositiveenvironmentalandsocialimpactsoftheirprojects.Thismodelcouldtakedifferentformats(e.g.,athird-party-ledcertification,aREC+model)butultimatelywouldservetoprovideareliablemethodofvalidatingaproject’sBTMattributes.11Asareminder,ProspectiveenergycustomersareorganizationsthatdonotcurrentlyconsiderBTMprinciplesduringenergyprocurementandarelesslikelytohaveasophisticatedcleanenergyprocurementprocess.Thesetypesofcorporateenergybuyersaredescribedinmoredetailin"AreCompaniesInterestedinBTMAttributes"onpage11.21Acertificationprogramwouldneedtodeliveronthefollowingcriteria:•Demonstratelowcosttoenergycustomersanddevelopers(orbepalatablefromacostperspective)•Useaclear,broadlyaccepted,verifiablestandard(tobedeveloped,perAction2)•Beeasyforenergycustomersanddeveloperstocertify•Includenewand,ideally,existingcleanenergyprojects•BeownedandoperatedbyacrediblebodywithanindependentauditingfunctionItwillbecriticaltomonitorcustomeranddeveloperadoptionofBTMattributestoassesswhenthemarketisreadyforcertification.Enablingmarketconditionsforeachstepofthisprocesswillbeimportanttoensuringthatparticipantswillacceptandusethecertificationasitdevelops.EnergyCustomer&DeveloperCallstoAction•Bevocalasneedforcertifiedcleanenergyincreases.Stakeholderswilllooktoenergycustomersfirsttoassessifthereissufficientdemandtowarrantdevelopingacertification.Customers,especiallyPioneersandPragmatists,shouldadvocateforprojectswithcertifiedBTMattributeswithprovidersandevenstateandfederalregulators.Customerscanusetheirexistingprocurementprocessandindustry-wideforumstocommunicatetheirevolvingneeds.•Shapethecreationofacertification.Astheeventualendusers,customersanddevelopersshouldprovideinputtocertifierstodeterminethecertificationfeaturesthatwillhavethemostlong-termvaluetotheindustry(e.g.,lowcost,easytocommunicate).Again,PioneerandPragmatistcustomersshouldconsiderproactivelypartneringwithleadingNGOstoensureapotentialcertificationalignswiththeirneeds.Action4:AdvocateforregulatorypolicyandlegislationthatincentivizeadoptionofBTMprinciplesacrossthecleanenergysector.Policysolutions(e.g.,mandates,taxincentives)cansignificantlyincreasetheadoptionofBTMattributes.Allcleanenergystakeholders(i.e.,developers,energycustomers,serviceproviders,advocates)cansupportpolicymeasuresinthefollowingtwoways.EnergyCustomer&DeveloperCallstoAction•Propagateandleveragethecurrentlegislativeprovisions.TheIRAintheU.S.andsimilarlegislationinotherregionsprovidevarioustaxincentivesthatpromotesomeoftheBTMattributes(e.g.,sitingonbrownfieldsorwithinenergycommunities).Energycustomersanddevelopersshouldaimtoproactivelyembedcleanenergydevelopmentandprocurementattributesthatareincentivizedlegislatively,aswellasshareopportunitieswithintheircommunities.•Advocatefornewpolicies.AllcleanenergystakeholdersshouldsimilarlylooktosupportnewpolicymeasuresthatalignwithBTMprinciplesforpurpose-drivenenergyprocurementthroughdirectadvocacyorbyfinanciallysupportingpolicyadvocatesfornewlegislationatthenationalandlocallevel.Thelegislationcanbetargetedatadditionalincentives,increasedtransparency,orsetrequirements.Asafirststep,stakeholdersshouldlooktoeducatetheirinternalpolicyteamsonthebenefitsofBTMattributestoensuretheiradvocacyalignswithandsupportstheirefforts.22CLOSINGREMARKSThisreportisoneofthefirststepsinabroaderprocesstowardraisingawarenessoncleanenergyprocurementwithenvironmental,social,andresiliencevalues.Theauthorswelcomethefeedbackofanyonewithvaluableperspectivesandideas.CEBI,TNC,andothercontributingpartieswillcontinuetolistentotheguidanceofthecommunitiesinwhichcleanenergyisdevelopedinordertocontinuouslyimproveonBTMprinciples.Thereareasignificantnumberofchallengesahead,butthesechallengesalsorepresentatremendousopportunitytocreateabetterworld.ThiscollaborativeeffortbetweenCEBI,TNC,andBain&Companyhopestorealizethecleanenergysector’sfullestpotentialinacceleratinganequitableandsustainablecleanenergytransition.23APPENDIXClimate,Conservation,&Sustainability•Projectsitecarbonfootprintimpact.Carbonfootprintimpactrepresentsthenetcarbonreductionbasedonprojectsitingdecisions.Examplesofprojectsthatminimizethecarbonfootprintimpactareavoidingsitesthatwillrequiredeforestationordevelopingsolarfarmsonunusedmines.Giventheindustry-widefocusonadditionalityandnetcarbonreduction,customersanddevelopersfindthisattributehighlycritical.Monitoringthenetcarbonfootprintimpactalsohelpscustomersprotectthemselvesagainstanygreenwashingallegations.Minimizationofthecarbonfootprintimpactiscurrentlyavoluntarypracticebydevelopers.•Environmentalimpactoftheupstreamsupplychain.Thisattributerepresentstheenvironmentalimpactofextractingrawmaterialsandmanufacturingproductsfornewcleanenergydevelopment.Anexampleofthisattributewouldbeusinglow-carbonmaterialsinprojectdevelopment.Similartocarbonfootprintimpact,customersanddevelopersvaluethisattributebecauseitensurestheyarehavinganetpositiveimpactontheirdecarbonizationefforts.Valuationofthisattributeisavoluntarypracticetoday.•Wildlifeandhabitatimpact.Oftenrequiredbyfederalorlocalagencies,wildlifeandhabitatimpactassessmentsareseenascriticalbydevelopersandcustomers.Developersfindscreeningprojectswithnegativewildlife/habitatimpactpreventsissueslaterintheproject,whenmitigatingadverseimpactscansignificantlyaddtothecosts.So,developersareintimatelyawareoftherequirementssurroundingwildlifeandhabitatimpact.Developersandcustomersfindthisattributecriticalinmanagingtheirreputationalrisks(e.g.,customersanddevelopersalikedon’twantmediacoverageoftheirwindfarmkillingbaldeagles).CommunityEngagement&SocialEquity•Workforcestandardsandusageoflocal,diverselabor.Workforcestandardsrefertotheworkingconditionsandtheprevailingwagespaidtoemployeesworkingtheprojectsite.Customersanddevelopersfindworkforcestandardsanduseoflocal(anddiverse)laborcritical,astheyhelpbuildpositivecommunitysentimentandgivecustomersatrackableandtangibleoutcometomeasure.Benefitssuchasprevailingwagesandthecreationoflocaljobsaresimpletounderstandandcancreateaclearimpactstoryforthepublic.•Impactonlocalcommunities.Similartotheworkforcestandardsanduseoflocal,diverselabor,minimizinganynegativeimpactfromthecleanenergyprojectonthelocalcommunitiesiscriticaltoensuringgoodstandingwiththecommunity.Thesenegativeeffectscantaketheformofhealthimpacts(e.g.,dust,toxins)ornon-healthimpacts(e.g.,visualimpactfromwindmills).Negativeimpactscanalsobemitigatedthroughproactivemeasuresdedicatedtoprovidingcommunity-definedco-benefitstolocalcommunities.EnergyGenerationResilience•Operationalresiliency.Operationalresiliencyrepresentstheshort-termresilienceagainstoutages(e.g.,maintenancerequired,serviceinterruptions).Thisisdeemedespeciallycriticalbycustomerswhowantaconsistentandreliablecleanenergysupplythatmatchesorexceedsreliabilityfromexistingsources.Allresilienceattributesarecurrentlycarriedoutvoluntarilybydevelopers.•Long-termviabilityofnewprojectsandtheenergysystems.Newcleanenergyprojectsshouldbebuiltkeepinglong-termclimatechallenges(e.g.,risingsealevel)inmind.Thiswillensurethatthegenerationcapacityofthecleanenergyprojectcanberelieduponforthefulllifeofthegenerationplant.•Supplychainprocurementrisks.Resilienceagainstdisruptiontothesupplychain(e.g.,fromembargoesornaturaldisasters)isapriorityfordevelopersandcustomers.Recentgeopoliticalissueshavefurtherhighlightedtheimportanceofinsulatingthesupplychainfrominterruptionsfordevelopers.TheIRAmayaddresssomeoftheseinterruptionswithincentivestospurmoredomesticcontentincleanenergyprojects.24GLOSSARY3CClimate,Conservation,andCommunitiesBTMBeyondtheMegawattCEBICleanEnergyBuyersInstituteDEIDiversity,Equity,andInclusionESGEnvironmental,Social,andGovernanceGWGigawattIIJAInfrastructureInvestmentandJobsActIRAInflationReductionActMWhMegawattHourNGONongovernmentalOrganizationREC+RenewableEnergyCertificatewithadditionalattributesorcriteriaRFPRequestforProposalTNCTheNatureConservancyCEBICleanEnergyBuyersInstituteAddressCleanEnergyBuyersInstitute(CEBI)1425KSt.NW,Suite1110,Washington,DC20005Phone1.888.458.2322Email/Webinfo@cebi.orgwww.cebi.orgwww.cebi.org
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