Many firms mistakenly believe they have decarbonized their electricity when they sign up for "100 percent renewable energy" contracts, a carbon accounting startup has warned.
Most carbon-free energy accounts don't take into account the fluctuating supply of renewable electricity, which doesn't match the user's energy consumption hour by hour, says Flexidao. The carbon tracking firm has today launched 24/7 Carbon Free Energy Academy, an education platform that aims to help businesses procure truly carbon-free electricity.
Many data center operators attempt to reduce their effective emissions by buying power purchase agreements (PPAs), which purchase an amount of green energy to match the amount of energy they use. However, these PPAs don't match the energy used hour by hour, so the electricity grid must use fossil fuels to match peaks of demand, and has a surplus of green energy at other times. Industry groups including the Long Duration Energy Storage Council (LDES Council) have advocated for 24x7 PPAs which also fund energy storage to balance the demand.
FlexiDAO uses a blockchain system to track the emissions a company produces hour by hour along with the carbon intensity of its energy supply. Microsoft and Google, who are both members of the LDES Council, promised to use 100 percent carbon-free electricity by 2030, invested in FlexiDAO, and are using it to track their carbon emissions. SET Ventures and EIT InnoEnergy have also given the company $6.5 million to grow its platform.
FlexiDAO says its software traces electricity and its carbon footprint through the entire supply chain every hour of the day, providing transparency to customers.
The use of blockchain is not a large overhead, Simone Accornero, CEO of FlexiDAO explained in a DCD podcast last year, as the validation protocol Energy Web Chain does not involve the wasteful Proof of Work algorithm which drives excessive energy use in applications such as Bitcoin: "It does not require mining or other compute-intensive activities. Hence, Flexidao’s application indeed saves a lot more energy than it uses."
Flexidao sees a large market because companies are under increasing pressure to make new environmental commitments and to deliver on existing promises. "Last year, 263 financial institutions demanded corporate environmental data from non-disclosing companies, signifying a real need for practical support on how firms can set and meet sustainability goals," says the FlexiDAO release.
Proposed new rules from the US Securities and Exchange Commission could force companies to disclose their carbon emissions, including Scope 2 emissions from the energy they use.
FlexiDAO says the 24/7 CFE Academy will help forward-thinking companies to deliver on promises and keep ahead of potential regulations, so they can make investment and procurement decisions that have a positive decarbonization impact. It could also save money: a recent study from Oxford Martin School found that decarbonizing the energy system could save US$12 trillion.
The Academy is available online, with on-demand content supplemented by in-person workshops offered through a partner network. It is also supported by electricity industry association Eurelectric, which itself has created a European 24/7 Hub to drive and advocate for 24/7 carbon matching.
The Academy's course content includes guidance on what 24/7 CFE means and a step-by-step guide on practical moves to achieve it.
Amanda Peterson Corio, Global Head of Data Center Energy at Google, said, “The 24/7 Academy provides access to the right information and resources, so businesses don’t have to start from scratch when exploring 24/7 CFE. There are many interesting things Google and other companies can do as a result of this Academy to reduce emissions faster, effectively, and at the least cost.”
Joan Collell, Co-Founder of FlexiDAO, said: “We’ve created our Academy to provide energy buyers with the information they need to drive decarbonization within their organization. Not only is this important from an environmental point of view, but a commercial perspective too. As a company’s environmental credentials become increasingly important to stakeholders, progressive businesses have a unique opportunity to drive decarbonization and reap the benefits of the early mover advantage.”
Irina Lazzerini at Sustainable Energy for All said, “Decarbonizing the electricity sector is at the center of the climate challenge; organizations adopting 24/7 carbon-free energy can accelerate the vital transition to clean electricity whilst reducing their reliance on fossil fuels. FlexiDAO’s 24/7 Academy is an innovative tool to help with this journey, equipping organizations with the right knowledge to turn climate intention into climate action.”