Premium

‘We only want green electrons’

Facebook
Twitter
LinkedIn
Reddit
Email
CEO of EDPR Renewables, Sandhya Ganapathy, says that the US is fundamentally a “demand-driven market”. Image: Sandhya Ganapathy, LinkedIn

“I would say around 65-70% of demand in the US market is being driven by corporate demand in different shapes and forms,” says Sandhya Ganapathy, CEO of EDP Renewables North America (EDPR).

EDPR has signed some major offtake agreements with some of the biggest corporate players in the US. Meta, Microsoft and Google are among its partners across the country as big tech companies have emerged as the largest private buyers of renewable power. The biggest of those deals, by generation capacity, was a 650MW framework partnership with Google for over 80 projects across six US states.

This article requires Premium SubscriptionBasic (FREE) Subscription

Unlock unlimited access for 12 whole months of distinctive global analysis

Photovoltaics International is now included.

  • Regular insight and analysis of the industry’s biggest developments
  • In-depth interviews with the industry’s leading figures
  • Unlimited digital access to the PV Tech Power journal catalogue
  • Unlimited digital access to the Photovoltaics International journal catalogue
  • Access to more than 1,000 technical papers
  • Discounts on Solar Media’s portfolio of events, in-person and virtual

Or continue reading this article for free

Ganapathy says that corporations represent the “biggest bucket” of demand in the US solar and renewable energy sector. Largely, she says, this is through the decision to shift to renewable power to provide for growing demand.

“Effectively, corporates are saying, ‘We only want green electrons. We know that our consumption is increasing, we know that manufacturing and electrification are growing and that AI-driven demand is propelling everything, and we are opting to use green electrons.’,” Ganapathy explains.

“And it’s not just big tech. Of course, they consume a lot. But you also have smaller companies either securing in the places where they’re actually functioning or in certain standalone ISOs or power markets.

“For example, we just signed a deal with a steel manufacturer, Cleveland-Cliffs – one of their earliest PPAs in the market.”

Ganapathy says that the “beauty” of corporate demand for renewable energy is that, as PPA contracts have reached up to 15 or 20 years, both developer and offtaker can bank on certainty. Developers have investment certainty, she says, for the lifespan of a project, whilst corporates offtaking power can factor stable power prices into their forecasting and long-term financial plans.

“I would say that renewables are the only source which can provide that stability and visibility for power prices. No wonder corporates are lapping it up.”

A demand-driven economy’

The US is on track for a record year for solar installations. Climate thinktank Ember says that the country added around 20GW of utility-scale solar PV capacity in the first six months of 2024, 55% more than the same period in 2023. If that pace continues, the US could end the year with almost double the utility-scale solar capacity additions of last year.

Ganapathy says this market expansion is, at root, driven by corporate demand and contrasts the situation with Europe: “I think, on the utility-scale side, we’re seeing a lot of pickup primarily because it’s a demand-driven economy. That’s the biggest difference between the US and Europe; in Europe it’s very emissions-driven, which is propelled by the government. [In the US] it’s just demand-supply, and that’s the beauty of it. I’m super optimistic.”

By leaving solar deployment in the hands of market demand the US has at once proved the profitability of the technology for corporate power buying, but also left it open to the vagaries of the market. This week, two Kentucky utilities published their Integrated Resource Plans (IRP) which included no new solar development until 2035 unless the technology “becomes more economically competitive”. The same IRPs included the expansion of gas generation plants.

Whilst commitments from big tech or retail offtakers to renewable energy are powerful, the wider goal of a global energy transition which, by almost all accounts, will be led by solar PV over the next 20 years, perhaps benefits from stronger non-market forces.

Broadly, Ganapathy is exceedingly positive about the development of the US solar market, particularly off the back of the Inflation Reduction Act (IRA).

“Next year and the year after I think we’ll really start to see some of the benefits of the IRA, because we’ll have a streamlined supply chain and all of the guidelines in place,” she says.

‘The single biggest challenge’

There is, however, a challenge to the US solar expansion that looms larger than global supply chains and could hold back the hopes of a developer like EDPR: the grid.

“The grid is the single biggest structural challenge, Ganapathy tells us, “and what’s happening today is very unique.

“First, the grid is ageing. Second, not even a fraction of the reinforcements required for the grid have been made. Third, there is a significant increase in demand; it could be manufacturing, electrification, data, AI…whatever.”

Crucially, she says that the extent and pace of increasing demand is outstripping the energy efficiency measures which could have counteracted demand increases in the past. The integration of AI and digital grids, increased uptake of energy storage and other enhancing measures can offset greater demand to a point, but Ganapathy says: “Now, the increase in demand is so much that offset is not going to happen anymore.”

She gives the example of AI, which US bank Wells Fargo said it expects to surge in demand by 550% by 2026. Whether AI demand heralds a “global energy crisis”, as has been claimed in some corners of the media, is unclear, but it adds to the strain on the US’ already ageing grid.

“If you need reliable power [for AI data centres] on a system which is already ageing, that’s just too much,” Ganapathy says.

The US already reportedly has over 1TW of solar PV capacity in its grid interconnection queues. That number more than doubles when you include every power generation technology waiting for a grid connection.

“From the developer side, we want to deploy capital. We want to put more megawatts on the ground. The number of projects which are in the queues today, we are talking anywhere between 200 to 300 to 350GW per ISO, and that is more than the actual installed capacities. And so the grid needs a massive overhaul.”

The International Energy Agency (IEA) says that grid upgrades can often take up to 15 years to plan, permit and complete. Renewable energy projects take around five. In recent months the US Department of Energy (DOE) has announced various rounds and injections of funding into the nation’s grid,

“FERC 1920 was a good start,” Ganapathy says of the legislation which requires ISOs to consider long-term capacity plans. “But when you think about the various challenges – you’ve got macro challenges like inflation, pricing, trade and tariff related issues – but the biggest thing which takes time to fix is getting your infrastructure in place.

“And we are so far behind for a country like the US. It’s a shame.”

A company the size of EDPR can play the waiting game in the US interconnection queue more easily than smaller players.

“Larger companies have the ability to have a deep enough pipeline that we can have the patience to wait five, six, seven years,” she says, but insists that it’s “not about what EDPR have done, but what we could have done if we had a more resilient grid.

“The market is there, we have the appetite, investors want this. The grid is the stumbling block.”

Solar-plus-storage

EDPR North America inaugurated a 200MW/40MW solar-plus-storage project in California earlier this year. Incidentally, the Scarlet I project is in Fresno County, the US county with the longest grid interconnection queue.

“It won’t be too long before we see that the majority of solar projects are combined with energy storage, because the grid needs it,” Ganapathy says. “It’s essential [in order] to make sure we don’t have blackouts.”

The kink which needs to be ironed out is the financing for these projects. Ganapathy has a financial background (she used to work as an investment banker at a number of major firms and joined EDPR as the head of investments) and it ran like a vein of ore through many of her answers to our questions.

“The ability to generate and store and discharge is a value proposition of renewables,” she says, “and we also have to think about how the economics of batteries are evolving.

“Today we have two-hour and four-hour [duration]; it’s become very commonplace. Peaople have started using eight-hour but it’s still not entirely economical. As technology develops, the beauty of renewables being able to provide a 24/7 solution is absolutely vital – and for that, storage is the critical piece.”

California, where the Scarlet I project is located, is a useful test case market for storage integration. The state’s infamous “duck curve”, where a huge amount of solar PV capacity pushes power prices down to near-zero in the middle of the day (and the resulting graph looks like a duck’s silhouette) has led the state’s ISO to cut back incentives for residential solar and push for residential storage adoption and peak-time usage. As well as likely tying more Californians to utilities’ supply, this move was designed to balance supply and demand for renewable energy.

A similar situation applies to grid-scale projects, albeit on a far larger scale. “How do you have a good enough investment case that you’re able to deploy more solar – which is required – but also provide pricing which is palatable for everyone?”, Ganapathy asks.

The financially savvy CEO of a project developer sees things in terms of functional markets and bottom lines, rather than less hard-nosed notions of openly and democratically available solar power.

“That’s where storage comes in. If you’re able to combine wind and solar and put batteries along with that, that’s when you have a kind of base load-type structure that you can mimic.

“If I had a crystal ball,” Ganapathy says, “I’d ask it how this storage thing is going to evolve.”

US presidential election

When we spoke to Ganapathy, it was over a month until the US presidential election. Now, at time of publication, it is two weeks away.

“I don’t think there’ll be any debate about whether you need renewables or not,” Ganapathy says of the differences between a prospective Trump or Harris presidency and the questions over whether the former will try to repeal the IRA.

“You can’t stop the sun from shining or the wind from blowing, so whether it’s a Republican state or a Democratic state [renewables] will be there. In fact, most Republican states have benefitted the most of any state [from the IRA].”

Indeed, Republican-controlled Georgia and Texas have both seen investment for renewable energy manufacturing and deployments expand massively. Texas recently passed California as the state with the most deployed solar PV capacity, and Georgia has become home to a US$2.5 billion solar manufacturing hub from Korean-owned Hanwha Qcells.

In August, a group of Republican senators issued a public statement warning against repealing IRA tax credits for renewable energy

“So when it comes to economic development, when it comes to jobs, when it comes to providing additional income to farmers, when it comes to property tax and the impact it can actually have on communities…I feel very hopeful that congress will work together to uphold the IRA.”

5 November 2024
10am GMT
FREE WEBINAR - Dr. Finlay Colville, Head of Research at PV-Tech, will revisit his two pivotal talks from the recent PV CellTech USA 2024 in the San Francisco Bay Area, offering an in-depth analysis of the PV manufacturing landscape. As the solar industry enters the Terawatt era, Dr. Colville will explore the technological advancements in recent years and what is set to unfold to the end of the decade.
13 November 2024
4pm GMT / 8am PST
This webinar by PVcase will provide an understanding of data risk for renewable energy projects and the challenges it poses, providing you with practical strategies and best practices to ensure data accuracy and reliability throughout your entire project. You'll explore innovative solutions offered by PVcase, including end-to-end automation, high-fidelity data analysis, and seamless data transfer, which can transform solar project development. By staying informed about the latest challenges and leveraging cutting-edge technology, you'll maximise project success, protect financial investments, and contribute to the broader goal of accelerating the clean energy transition. Don’t miss this opportunity to enhance the success and reliability of your solar developments.
17 June 2025
Napa, USA
PV Tech has been running PV ModuleTech Conferences since 2017. PV ModuleTech USA, on 17-18 June 2025, will be our fourth PV ModulelTech conference dedicated to the U.S. utility scale solar sector. The event will gather the key stakeholders from solar developers, solar asset owners and investors, PV manufacturing, policy-making and and all interested downstream channels and third-party entities. The goal is simple: to map out the PV module supply channels to the U.S. out to 2026 and beyond.

Read Next

November 1, 2024
Scatec has published its latest financial results, which include revenues of NOK2.97 billion (US$270 million) in the third quarter of 2024.
November 1, 2024
US residential solar installer Sunnova has published its financial results for Q3 2024, which include net losses of US$52.5 million.
November 1, 2024
Swiss-based solar manufacturer Meyer Burger has registered a net loss of CHF317 million (US$365 million) in the first half of 2024, a nearly fivefold increase from H1 2023 when it had a net loss of CHF65 million.
November 1, 2024
Chinese solar manufacturer Aiko Solar said yesterday (31 October) it has partnered with the Australian Centre for Advanced Photovoltaics (ACAP) to launch a US$4 million initiative aiming to achieve 30% efficiency with interdigitated back contact (IBC) solar cells.
October 31, 2024
The solar panel recycling factory will be adjacent to the solar glass recycling plant Solarcycle is currently building in Georgia.
October 31, 2024
Spanish private equity firm BRUC has invested €2.26billion (US$1.34 billion) to build solar PV projects in the Spanish autonomous community of Andalusia.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
November 12, 2024
San Diego, USA
Solar Media Events, Upcoming Webinars
November 13, 2024
4pm GMT / 8am PST
Solar Media Events
November 20, 2024
Zhuhai, China
Solar Media Events
November 21, 2024
London, UK