Conversations with Corporate Decision Makers: #1 Green Power
This is how it usually goes.
Him/her: Hi Mr. Carbontrader thanks for meeting with me today.
Me: No problem Fortune 500 Decision Maker.
Him/her: I have some questions today that pertain to our environmental stewardship goals and carbon risk in general and I hope can help.
Me: Fire away.
Him/her: So, first of all we are looking at purchasing renewable energy for our corporate headquarters and we've called our local utility. They offer "Green Power" for an additional 2 cents per kilowatt hour. That's pretty good right, its just 2 cents.
Me: No, that's awful. As a matter of fact its insulting that they would charge you that much considering that you are trying to make a socially responsible decision.
Him/her: What do you mean? How much does that come out to in dollars per year?
Me: Well, lets do some quick math. Do you know how many kWh you use per year at your facility?
Him/her: Well, I do have that information somewhere, but our facilities manager pretty much handles that.
Me: Ok, in lieu of that number we can make an estimate using information you should know. Answer these questions:
1. How many square feet does your facility occupy?
2. What type of use is it? (Educational, office space, grocery, manufacturing,
religious use,warehouse,etc.)
Him/her: Let's say 100,000 square feet and it happens to be office space
Me: Okay, so all we need to do is multiply your square footage times your median electical intensity. This number generally ranges between 4 and 50 kWh. A warehouse is at the low end and a grocery store with its isles of refrigeration is nearer to the high end. The average office space is usually around 8.5 kWh/sq.ft/year. So, 100,000 x 8.5 = 850,000 kWh per year.
Him/her: Okay, that sounds about right.
Me: Now, take that value and multiply it times $.02/kWh to get a green power price tag of approx. $17,000. Now, don't forget that is an annual cost.
Him/her: That's not bad. We don't really have a choice though because we dont want to switch to another provider.
Me: You dont need to switch electricity power providers in order for your power to be GREEN.
Him/her: Really, how is that possible.
Me: Well, when you buy Green Power from your utility or ESCO you are really buying two separate things. 1) Power and 2) Green.
Him/her: Okay, I think I get it. The power is just the regular electricity that I have been buying and the "Green" is a Renewable Energy Certificate (REC) which represents the renewable attributes that every 1 MWh (1000 kWh) of energy produced by a renewable generator is tagged with.
Me: That's correct.
Him/her: So, what you're telling me is that my current provider is selling me electricity for about $.06/kWh and RECs to go along with that electricity for $.02/kWh in order to make it Green.
Me: That's correct. That's using the average electricty rate for the city of Chicago. In areas of higher electricty consumption rates, such as LA, NY, and Texas you could be looking at closer to $.12/kWh.
Him/her: Well, for Chicago that means that we're paying a 33% premium to go green.
Me: You got it.
Him/her: So, what is your solution?
Me: I can recommend a handful of Green Power/Carbon Trading companies that can deliver the RECs to make your current electricity GREEN, for 10-20% of the cost that your utility is offering.
Him/her: So, we continue buying the power from our current provider and we buy the RECs from these Green Power/Carbon Trading companies?
Me: That's correct.
Him/her: Okay, what is the cost.
Me: Well, I wouldn't pay more than $.004/kWh. So, instead of 2 cents you can get the same greeness from a company that specializes in RECs and carbon for less than half of one cent.
Him/her: Interesting. So, looking back at my consumption of 850,000 kWh per year, I could cut my green power cost from $17,000 to $3,400.
Me: That's right and if you have multiple facilities I happen to know that you can get Green Power RECs for even less than that when you buy in bulk. Try $.002/kWh.
Him/her: So, if I have 10 facilities that all need Green Power I could buy in bulk and for the same $17,000 that I thought was a good deal buying from my local provider - I could buy RECs for 10 of my facilities and make them 100% Green Powered????
Me: Precisely.
Him/her: Well, Carbontrader you've been very helpful. I'm going to google REC marketers and see who pops up!
Me: Glad I could help. Next time, we can talk about how to read a REC contract to make sure you're getting the best bang for your buck and also what government programs can help you capitalize on your environmental stewardship purchase.
This is how it usually goes.
Him/her: Hi Mr. Carbontrader thanks for meeting with me today.
Me: No problem Fortune 500 Decision Maker.
Him/her: I have some questions today that pertain to our environmental stewardship goals and carbon risk in general and I hope can help.
Me: Fire away.
Him/her: So, first of all we are looking at purchasing renewable energy for our corporate headquarters and we've called our local utility. They offer "Green Power" for an additional 2 cents per kilowatt hour. That's pretty good right, its just 2 cents.
Me: No, that's awful. As a matter of fact its insulting that they would charge you that much considering that you are trying to make a socially responsible decision.
Him/her: What do you mean? How much does that come out to in dollars per year?
Me: Well, lets do some quick math. Do you know how many kWh you use per year at your facility?
Him/her: Well, I do have that information somewhere, but our facilities manager pretty much handles that.
Me: Ok, in lieu of that number we can make an estimate using information you should know. Answer these questions:
1. How many square feet does your facility occupy?
2. What type of use is it? (Educational, office space, grocery, manufacturing,
religious use,warehouse,etc.)
Him/her: Let's say 100,000 square feet and it happens to be office space
Me: Okay, so all we need to do is multiply your square footage times your median electical intensity. This number generally ranges between 4 and 50 kWh. A warehouse is at the low end and a grocery store with its isles of refrigeration is nearer to the high end. The average office space is usually around 8.5 kWh/sq.ft/year. So, 100,000 x 8.5 = 850,000 kWh per year.
Him/her: Okay, that sounds about right.
Me: Now, take that value and multiply it times $.02/kWh to get a green power price tag of approx. $17,000. Now, don't forget that is an annual cost.
Him/her: That's not bad. We don't really have a choice though because we dont want to switch to another provider.
Me: You dont need to switch electricity power providers in order for your power to be GREEN.
Him/her: Really, how is that possible.
Me: Well, when you buy Green Power from your utility or ESCO you are really buying two separate things. 1) Power and 2) Green.
Him/her: Okay, I think I get it. The power is just the regular electricity that I have been buying and the "Green" is a Renewable Energy Certificate (REC) which represents the renewable attributes that every 1 MWh (1000 kWh) of energy produced by a renewable generator is tagged with.
Me: That's correct.
Him/her: So, what you're telling me is that my current provider is selling me electricity for about $.06/kWh and RECs to go along with that electricity for $.02/kWh in order to make it Green.
Me: That's correct. That's using the average electricty rate for the city of Chicago. In areas of higher electricty consumption rates, such as LA, NY, and Texas you could be looking at closer to $.12/kWh.
Him/her: Well, for Chicago that means that we're paying a 33% premium to go green.
Me: You got it.
Him/her: So, what is your solution?
Me: I can recommend a handful of Green Power/Carbon Trading companies that can deliver the RECs to make your current electricity GREEN, for 10-20% of the cost that your utility is offering.
Him/her: So, we continue buying the power from our current provider and we buy the RECs from these Green Power/Carbon Trading companies?
Me: That's correct.
Him/her: Okay, what is the cost.
Me: Well, I wouldn't pay more than $.004/kWh. So, instead of 2 cents you can get the same greeness from a company that specializes in RECs and carbon for less than half of one cent.
Him/her: Interesting. So, looking back at my consumption of 850,000 kWh per year, I could cut my green power cost from $17,000 to $3,400.
Me: That's right and if you have multiple facilities I happen to know that you can get Green Power RECs for even less than that when you buy in bulk. Try $.002/kWh.
Him/her: So, if I have 10 facilities that all need Green Power I could buy in bulk and for the same $17,000 that I thought was a good deal buying from my local provider - I could buy RECs for 10 of my facilities and make them 100% Green Powered????
Me: Precisely.
Him/her: Well, Carbontrader you've been very helpful. I'm going to google REC marketers and see who pops up!
Me: Glad I could help. Next time, we can talk about how to read a REC contract to make sure you're getting the best bang for your buck and also what government programs can help you capitalize on your environmental stewardship purchase.
posted by CarbonTrader at 6:31 PM
1 Comments:
Very informatic website. I got many business contact details here. Manufacturers India, Suppliers Surat, Exporters Gujarat, Wholesalers, Agencies Yellow Pages and Directory
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