Tech giant Google is joining forces with one of North America’s largest clean energy companies to build a 500-megawatt solar portfolio in 80 community- sized chunks, with 10% of the resulting revenue flowing to at least 25,000 “high-energy-burden” households.
“Google will use that solar power to further its goal of achieving round-the-clock clean energy by 2030, with a focus on cleaning up the energy consumption of its data centres in Ohio,” reports Canary Media. But the initiative also has a significant environmental justice component: “At least one-third of the solar projects will be built in low- and moderate-income communities, creating jobs and tax revenue on top of the reduced energy costs they’ll deliver.”
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“They’ll structure these solar projects to ensure that at least 10% of the money they make flows to at least 25,000 ‘high-energy-burden’ households, including those located in communities that host the solar farms themselves,” Canary says.
Google’s plan—for EDP Renewables North America Distributed Generation (EDPR NA DG) to build 500 MW of solar through small-scale projects in the 13-state region served by grid operator PJM—is the largest corporate backing of distributed solar in the United States, states an EDPR news release. The plan is being termed “synthetic” community solar, as it “synthetically provides similar economic benefits of community solar in jurisdictions currently lacking supportive legislation.” Small, distributed solar projects can more easily connect to the grid, circumventing the years-long interconnection backlogs that a larger project would likely face, said EDPR Chief Investment Officer Richard Dovere.
Projects producing 20 MW of power or less “tend to be able to execute interconnection agreements much more quickly than larger projects,” Canary explains, partly because they “typically connect to lower-voltage distribution grids rather than transmission grids.”
PJM is in a particularly tight spot, with more than 250 gigawatts (that’s 250 billion watts) of clean energy in the queue, awaiting grid access. The operator is “actively reforming its interconnection processes, but that is expected to take years, leaving more than 1,000 projects in limbo until it is completed.”
Dovere said Google’s distributed generation plan would also bring the benefits of community solar—such as lower bills and local economic development—to people who have so far been left out of the energy transition. Titled the Clean Energy Financial Benefit Sharing Program, the plan will function much like community solar, which allows developers of smaller-scale projects to sell power to individual subscribers to cover a portion of their utility bills, Canary says.
It will be a particular boon to Ohio, as well as other PJM states like Pennsylvania and West Virginia, which do not have any other community solar programs yet.
The projects will be funded in part through Google’s purchase of a new renewable energy credit called the ImpactREC, the release notes. The credits are akin to traditional RECs, but they carry “additional covenants certifying direct community investment and direct low- and middle-income benefit.” The EDPR team worked with Google over the last two years to conceive and develop ImpactREC and its supporting framework agreement.
“What we heard through interviews with local community leaders and environmental justice advocates was that the disproportionate impact of high energy burden remains a primary barrier to an equitable energy transition,” said Google Energy Lead Sana Ouji. “Partnering with EDPR NA DG, we aim to reduce energy burden in the communities where we operate, while progressing toward our 24/7 carbon-free energy goal.”
The initiative was made possible in part by tax incentives for domestic energy and manufacturing under the 2022 Inflation Reduction Act, the release adds. Google and EDPR have also signed on to create a US$12-million community impact fund to reduce energy poverty in communities where the solar projects are built—on top of the 10% of project revenue that will be directed to lower-income households, Canary reports.
