Corporate and industrial energy users in California and PJM that try to cut carbon emissions by using a 100% annual matching renewable energy strategy could reduce emissions much more by opting instead to procure carbon-free electricity (CFE) to match their hour-by-hour demand, according to a new report by Princeton University.

The study, released Nov. 19, used mathematical modeling methods to look at the impact of procuring CFE to match hourly demand. In California and PJM, 24/7 CFE would enable C&I energy users to cut emissions by considerably more than if they had used an annual matching strategy, according to the study by four researchers at the university’s Andlinger Center for Energy and the Environment.

The report, which describes itself as the “first analysis of the electricity system-level impacts of 24/7 carbon-free energy procurement,” addresses one of the failings of the 100% annual matching strategy that have emerged since its adoption in recent years by some high-profile corporate names seeking to eradicate carbon emissions. The most notable was Google (NASDAQ:GOOGL), which sponsored the study.

In a 100% annual matching strategy, the user buys clean energy equal to its entire annual energy use. But despite the name, the strategy mostly does not yield zero carbon emissions because the user invariably turns to fossil fuel-generated power to meet their needs in those times clean energy sources are not functioning, such as when the wind isn’t blowing or the sun shining. The use of fossil-generated electricity reduces the user’s clean energy consumption and increases carbon.

“So, while you might buy enough megawatt-hours of clean energy to match your total consumption, there’s a mismatch between when those megawatt-hours are produced,” said Jesse Jenkins, an assistant professor of mechanical and aerospace engineering and one of the four researchers that produced the study.

In a 24/7 CFE strategy, the user purchases electricity to match its energy use profile hour by hour, sourcing energy from carbon-free sources such as nuclear or thermal energy when there is no solar or wind energy available.

“Clean firm technologies are technologies that are available any time of the year, for as long as you need them,” Jenkins said at a Nov. 19 webinar on the report. As a result, he said, they have “the potential to enable much deeper reductions in CO₂ emissions from electricity consumption.”

Emissions Reduction, Cost Increases

The Princeton report estimates that an annual matching strategy in California would result in CFE making up only 75% of electricity consumed; in PJM, it would only be 62%.

In contrast, a 24/7 CFE procurement strategy enables C&I users to “completely eliminate emissions,” the report said. The elimination is because of a “better alignment between electricity consumption and generation, which reduces periods of reliance on emitting grid-supplied electricity,” the study concludes.

However, the 24/7 strategy pushes up costs for energy users, the report adds. C&I energy users in California would pay 64% more in energy costs than with an annual strategy, the report said, while PJM consumers would pay 139% more.

The added cost of using 24/7 CFE would shrink in the future if some of the current technologies under development, such as geothermal and hydrogen-fueled generators, become viable, according to the report. And costs would also drop if the user was willing to accept something less than zero-emission energy; for example, 98% clean energy, the report said.

Corporate Zero-emissions Efforts

The 24/7 CFE strategy has emerged as more C&I energy users have started buying renewable energy to match their annual load. One early adopter, Google, has purchased renewable energy equal to its total consumption every year since 2017. But the company acknowledges that it is still a long way from its 2030 goal of using CFE in all locations and all hours, and the impact of the annual matching strategy was limited.

“When we surveyed our operations and our footprint, what we saw is that while we had put a lot of new renewable energy on the grid, we hadn’t taken off a lot of the dirty energy that was there,” Caroline Golin, global head of energy and climate policy at Google, told the Princeton webinar.

Google is among the more than 40 signatories to the 24/7 Carbon-free Energy Compact launched in September, one of several Energy Compacts coordinated in part by the U.N. Others include Orsted; AES; the city of Des Moines, Iowa; the city of Ithica, N.Y.; the government of Iceland; and the Nuclear Energy Institute. Microsoft and the U.S. government also are working on 24/7 CFE strategies, according to the Princeton report.

Under 24/7 CFE procurement, non-fossil sources of fuel are purchased within the same grid region, according to the report. The alternative energy sources cited by the report include conventional and advanced geothermal facilities, which tap into the heat deep below Earth’s surface, and nuclear energy. Others cited in the study include natural gas power plants that use carbon capture and storage technology and gas plants that use zero-carbon fuels. (See How Geothermal Can Support 24-7 Carbon-free Targets.)

Google and other corporate buyers say that greater use of storage will also be key to providing energy in those periods when wind and solar energy can’t. (See Storage the ‘Linchpin’ to 24/7 Carbon-free Power, Corporate Buyers Say.)

The Princeton study argues that a wide, speedy embrace of 24/7 CFE procurement would help advance development of storage technology and accelerate its uptake. A similar effect helped advance wind and solar technology as corporations embraced 100% annual renewable procurement, the report argues.

Retiring Fossil Fuel Plants

The amount that emissions can be reduced through the use of 24/7 CFE depends on two factors, according to the report. One is the volume of clean energy procured, because higher volumes of procurement drive producers to generate more clean energy. The other is timing, or the amount that non-wind and solar clean energy generators adjust the periods in which they produce energy to match those periods when solar and wind production is at its lowest, the report says.

A key reason that the 24/7 CFE strategy is less effective in PJM is that California has a larger share of existing CFE (64%) than PJM, which has just 22%, the report says. The 24/7 CFE strategy also has the effect of hastening the retirement of natural gas plants at a greater pace than would happen under the annual matching strategy as energy users turn to more sustainable methods, according to the report.

The Princeton researchers calculated that if 10% of the C&I energy users in California adopted 24/7 CFE, the shift would reduce gas generating capacity by more than 1.9 GW. That is more than four times as much as would be retired if the users adopted an annual strategy, the report says.

Likewise, the adoption of a 24/7 strategy by 10% of C&I users in PJM would retire more than 6.2 GW, 1.5 times as much as would be retired under annual matching, the report says.

Armond Cohen, executive director of advocacy group Clean Air Task Force, said the study raises an important question for corporations, because the “corporate 100% renewable goal was being interpreted as the complete solution set and a model” by some companies.

Speaking during the Princeton webinar outlining the report, Cohen said it is “important to kind of push the conversation a little farther, and align the corporate demonstration goals with the analysis suggesting that you need a full suite of technologies to address decarbonizing the grid because of the seasonal variation in wind and solar.”

The higher cost of 24/7 CFE “reflect reality,” he said.

“Commodity wind and solar is cheap. It gets you a certain part of the way. But we also have to recognize that full decarbonization is going to require some of these higher capex dispatchable technologies,” he said.