In this article, we outline the steps you may take to execute a 24/7 carbon-free energy (CFE) strategy. This can serve as a practical guide for corporate energy buyers, CSOs, and anyone interested in pursuing 24/7 CFE for their business.

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What is 24/7 CFE? 

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24/7 Carbon Free Energy is a renewable electricity procurement strategy that some corporate energy buyers worldwide are adopting in order to decrease the emissions related to their electricity supply. 24/7 CFE matches a buyer’s electricity demand, hour-by-hour, 24/7, with corresponding clean electricity generation from within the buyer’s local electricity grid or bidding zone. We work with companies such as Google and Microsoft, who are working towards 24/7 CFE goals. Our platform can be used to show an inventory of all of a company's global renewable electricity contracts in one place, including their associated energy certificates and emissions. With this information, customers can easily track our entire global portfolio, which can provide the oversight needed to work towards 24/7 goals. You can read more about our offer here.  

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How do you implement a 24/7 CFE Strategy? 

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Whereas 24/7 CFE strategies will vary from company to company, what we outline below has resulted from several years of research, experience, and iterative feedback from our partners and clients worldwide. In practice, these steps will need to be tailored to your specific needs, and Flexidao can help you along the way.

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All companies purchasing renewable energy are already on their way to consuming 24/7 carbon-free electricity. Adopting a CFE strategy is not just about getting to 100% 24/7 Carbon-free Energy today; nobody has yet achieved this goal.  It's about using data to make well-informed procurement decisions and begin reducing the carbon intensity of your contracted electricity every hour of the day. Regardless of current progress, all businesses can benefit from better oversight of their global electricity portfolio, which comes from better management of electricity-related data.

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Step 1 - Education & Unlocking Resources

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The first action in a 24/7  CFE strategy is simply to learn more about the approach. You will need to know the following:

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What is 24/7 CFE, and why is it important?

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24/7 CFE builds upon the foundations laid by disclosure schemes like RE100, as it is a method that some businesses are using to advance their decarbonisation impact related to their electricity supply. For example, since 2017 Google matched 100% of the electricity consumption of global operations with purchases of renewable energy, on an annual basis. Now they are going one step further with their goal to operate on 24/7 carbon-free energy (CFE) globally by 2030.  Other blogs of ours (e.g. What is 24/7 Carbon Free Energy ) can be a useful starting point for familiarizing yourself with the concept of 24/7 CFE. Eurelectric has also recently launched its European 24/7 hub, which provides more information on the what and why of 24/7.

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What is the market context and business case for 24/7 CFE?

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There are clear signs that carbon reporting will become a mandatory practice for businesses. Several regulatory bodies (like the U.S. Securities and Exchange Commission, the International Sustainability Standards Board, and the EU) have now proposed standards for climate-related disclosures. The common denominator in each of these proposals is that they have been informed by the GHG protocol, which is currently under review for additional guidance to be added. By already working towards a deeper decarbonisation impact with your energy procurement strategy, you are futureproofing your business against stricter carbon reporting requirements that may occur in this shifting energy and sustainability reporting landscape.

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Adopting a 24/7 carbon-free energy strategy is one way you can achieve this deeper level of decarbonization, by reducing your electricity-related emissions on an hourly, not just annual, basis and buying electricity from your local grid. You will also be showing the market that you are eager to spearhead the energy transition by adopting one of the latest best practices in energy procurement and gaining more accuracy and insight into the carbon content of your energy supply. This can increase the confidence of ESG investors. 

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b) Unlocking Resources

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You may need to build a business case for 24/7 CFE to pitch it to your leadership team and unlock the necessary resources to implement a 24/7 CFE strategy. 24/7 CFE can be of interest to different departments across your company, including finance, operations, procurement, sustainability management, and sales & marketing.

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Some pointers you could include in the business case for 24/7 CFE are:

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• Your company can start by understanding the hourly emissions factors of your current energy procurement strategy and your risk exposure (step 2 of this journey) at no extra energy cost to your business.
• You can increase your load's hourly match with low-cost, carbon-free energy products. Even if you don’t reach more than 80% of hourly CFE, your carbon reduction will be more than with a regular 100% annual RE contract. Research shows that energy costs can be kept flat or even drive cost savings in some regions when reaching 70-80% hourly CFE.
• You do not need to prioritize reaching 100% hourly CFE today if your company is cost sensitive. The last mile of hourly matching can still be expensive due to reliance on RE technologies that haven’t fully matured.

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You also may want to include external case studies of other businesses on their journey towards 100% 24/7 CFE (like Google) in your business case, as well as a cost-benefit analysis, and a proof of concept, which can focus on one country you operate in. This proof of concept will help illustrate visually to your leadership team why  “100% renewable energy” does not equate to “24/7 Carbon-free Energy.”.

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Step 2 - Baselining

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Now that you understand more about 24/7 CFE and have support from your company to start exploring it further, the next thing to do is assess where you are on the journey to 100% 24/7 CFE right now. This is called baselining, and it is important to remember: if you are already procuring renewable energy for your business, you will already have a baseline and be on your way to 100% 24/7 CFE. Looking at the global benchmark, 60-70% carbon-free energy can already be considered a good result; it is just a matter of understanding exactly where you are starting from.

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Implementing a 24/7 carbon-free energy procurement strategy requires meticulous planning and advanced technology like 24/7 CFE matching software. Baselining enables organizations to align their energy consumption with carbon-free generation on an hourly basis in all the countries where they operate. Having a general overview of your global carbon profile is extremely helpful so you can begin identifying which countries you should implement a CFE strategy first and where the “quick wins” are. 

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Get in touch with us for comprehensive reports that promote your organization’s baselining. Flexidao can help you work toward your RE goals by assessing your current position and providing strategic improvements to your procurement strategy. The data you will need for this is information your company should already have readily available (e.g., in your ERP system) and used in other company reporting. This includes:

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• The countries you operate in (currently, Flexidao has energy data access to countries and states in the EU and US. If you operate in other countries, please reach out so we can discuss this).
• Your annual energy consumption in these countries.
• Your renewable contracts (e.g., unbundled EACs, PPAs, green tariffs) per country.

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Step 3 - CFE strategy

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If you choose to adopt a CFE Strategy, the ultimate aim of all this data gathering and analysis is that it can enable you to assess new supply contracts based on price and real decarbonization impact.

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You may decide to adopt a 24/7 CFE target (a percentage to work towards of how carbon-free you want your total energy supply to be on an hourly basis by a given date, e.g., 90% CFE across all our sites in Germany by 2030), this can be a helpful benchmark but is not necessary for adopting a “24/7 mindset” in your procurement and reporting. A target like this can be made public or remain internal.

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You may want to start by adopting a 24/7 CFE strategy in the countries where you can have the highest impact on your CFE score. To work out where these countries are, you can complete regional feasibility reports of all the countries you operate in. Regional feasibility reports can provide a comparative overview of how easy and achievable it is to improve your CFE score in different markets. You will need to consider how prepared the local energy market is for 24/7 CFE products and what hourly renewable energy products and technology are already available in that market. Flexidao has deep expertise in data collection and can help with this step. Scenario planning will also help assess what procurement options can improve your CFE score at the best price in each region, depending on the availability of offers.  

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Step 4. a- Digitalization

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You will need to monitor your targets and KPIs on an ongoing basis to report on progress and understand how you can continue improving your procurement process. This can be helpful for both annual or hourly reporting of your renewable energy performances and Scope 2 emissions.  Live data collection is key, and automating it can help you save time, avoiding a headache regarding your company bookkeeping. We can help you collect the following data streams:

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1. Hourly consumption data for all sites under the company’s control, including the hourly fuel mix of grid electricity used.
2. Hourly energy production data from various sources, depending on the electricity product your company is currently purchasing (e.g., PPA’s, bundled or unbundled EACs). This sub-step may present different challenges depending on how accessible your data is; at Flexidao, we wrote a helpful white paper on metering data collection in Europe to help companies get their granular electricity data.
3. Hourly CO2 factors from the grid mix - key for accurate location-based emission calculations

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Software solutions such as Flexidao’s Inventory Platform automate the sourcing of all your energy-related data, thanks to its integrations with third parties, without needing hardware devices. With our platform, you will never need to log into a registry again. Inventory also helps you visualize and analyze your electricity contract data, enabling KPIs and relevant insights for procurement and sustainability teams.

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There are many benefits to digitally monitoring your energy procurement, not just related to 24/7 CFE. For instance, it allows you to consolidate all your sites' consumption data (either annual or granular), EACs, and supply contracts into one global, unified platform to save time in your annual Scope 2 monitoring and reporting process. Reach out to our customer success team if you want to know more about how our Inventory Platform can benefit your business.

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Step 4.b - Procurement

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If you are adopting a 24/7 CFE Strategy, then renewable energy procurement decisions can be tailored to better match your hourly consumption patterns.

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There are currently three main energy products you may want to consider:

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Hourly matched PPAs 

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You can procure PPAs with bundled EACs from an asset within the same grid region (or bidding zone) that provides access to hourly production data, so this can be matched to your consumption.

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An hourly matched PPA contract generally doesn't require any cost premium for your business. Eventually, costs could increase if more expensive technologies are included.

A challenge with this product is that your grid operator and/or supplier might encounter barriers when sending over hourly production data.

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Supply contract with hourly matched EACs 

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Signing an electricity supply contract from a supplier (retail tariffs or wholesale market prices) bundled with granular production data and EACs from one or more specific carbon-free energy asset(s).

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With this product, the energy buyer leverages the supplier's access to a comprehensive energy portfolio to increase their CFE score.

However, the energy supplier might charge an extra premium for assigning EACs from a specific asset and at a specific time.

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Unbundled Granular Certificates 

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With this product, you procure forward or historically unbundled EAC contracts from specific origination asset(s) to be able to perform hourly matching (no power included).

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Some barriers to overcome with this product are that your EAC broker must be able to assign Granular Certificates from a specific renewable asset, and energy producers might not be willing to share hourly production data given the novelty of the product.

With any of these products, Flexidao can provide insights into how the generation of the product matches on an hourly basis to your energy usage. 

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It will be important to stay aware of the current trends in renewable energy procurement. For example, as new energy storage solutions reduce cost in the coming years, they could offer a cost-effective way to improve your CFE score whilst also providing value to local grids.

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Step 5 - Certification

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As the market for 24/7 CFE evolves, granular certificates (GCs) will likely become a widely adopted market instrument. GCs are an evolution of current energy attribute certificate (EAC) schemes widely used worldwide. In the same way that EACs are needed to make credible claims on renewable energy consumption, GCs are needed to make sure there is no double counting of the origin of energy on an hourly basis. They include location, granular time stamps, granular CO2 emissions, and type of technology so buyers can simultaneously match the energy they consume hourly with electricity produced on the same grid. EnergyTag recently launched its first Granular Certificate Scheme standard - a set of criteria those implementing Granular Certificate Schemes need to meet.

Companies worldwide are already trialling GCs as a new instrument for exchanging energy and issuing bodies have been involved in these pilots, including our project with Microsoft, Eneco, and CertiQ, highlighting a growing interest from within the energy sector in GCs as a new market mechanism.

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What’s more, after the public endorsement from the European Association for the Cooperation of Transmission System Operators for Electricity (ENTSO-E), voluntary GCs have been adopted in the European Parliament's position for RED III. This represents a huge step forward in policy favoring GCs and enabling corporate energy buyers to adopt even more ambitious decarbonisation strategies.It may become a necessary future requirement in sustainability reports to certify how your renewable energy usage is time-matched with renewable generation on an hourly basis using GCs.

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As you can see, adopting a 24/7 carbon-free energy strategy is a case of evolving your current energy procurement strategy rather than disrupting it. Nobody expects you to reach 100% CFE now, but by peeking under the hood of your existing 100% RE target and using data to quantify how carbon-free your electricity supply not only provides much better oversight for accurate reporting, enhanced decision making and better protection against compliance risks.  If you want to learn more about how we can help you track your energy supply contracts and certificates with better accuracy and efficiency to reach your goals, whatever they may be, don’t hesitate to book a meeting with one of our experts.