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Is business leading the way in developing off-grid energy?

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The article below caught Nsure Renewables' eye. This is a summary from The Guardian's "Sustainable Business Blog" on 18th November 2013.

There used to be one reason alone for companies to stick a wind turbine in the car park or a solar panel on the roof, and that was a photo opportunity for marketing and the annual report. It looked good to be green but added to costs rather than lowered them. But as more businesses are choosing to invest in on-site renewable energy than ever before, the reasons appear to be changing.
A recent report found that on-site generation by UK businesses increased by 53% in 2012 alone, with almost 90% of that coming from solar and wind. And the motivation now is one of energy security.
According to the latest DECC figures, the annual average price of gas and electricity (including the climate change levy) has increased by 121% and 93% respectively since 2002 for non-domestic customers. Meanwhile costs of renewable technologies have gone down, performance has improved, whilst incentives and funding structures such as feed in tariffs (FITs), Renewable Obligation Certificates (ROCs) and Power Purchase Agreements (PPAs) have appeared.
"When we were making the original decision, one of the big things for us was energy security," says Graham Chadwick, environment and CDM functional manager at Bentley Motors. In April it installed the largest roof mounted solar panel system in the UK, over 20,000 solar panels with a capacity of 5MW fixed to its factory in Crewe.
The Carbon Trust's associate director of business advice, Dominic Burbridge, describes the current popularity of on-site renewables as "predominantly driven by a change in the business case... more organisations have been investing in energy efficiency, they've gained the returns of being more efficient and are asking 'where else can I make investments to cut costs and be greener?'"
He has also noticed "aggressive sales" for solar in particular. "Lots of companies now will go to an organisation with a large land or roof asset and say 'you don't even need to put any cash in, we can give you fixed-price energy basically for free, but we will take all the revenue that comes from the FITs and any electricity exported to the grid'"
In fact, very few companies own their on-site renewable assets. Bentley's is a joint venture with Lightsource Renewable Energy Limited, which leases the roof space. Toyota, whose 4.1MW array of 16,800 solar panels at its Burnaston site was previously the biggest in the country, is in partnership with British Gas. The benefit of such arrangements is that the company does not take on the risk or the up-front costs. Such co-ownership arrangements may only be a short-term trend, however. Mr. Burbridge argues that five- to seven-year payback periods for solar and warranties for 25 years on panels already offer "a good rate of return" and "owning on-site renewables means you get all the benefit".
Many of the world's largest companies are going even further. Since the first solar panel appeared on a Walmart store in 2007, it now produces about 4% of the electricity it uses in the US and aims for 20% by 2020. BMW's Leipzig plant in Germany installed four 2.5MW wind turbines this spring and Apple gets 16% of its electricity from solar and biogas.
The next trend is to move beyond on-site generation toward purchasing green energy direct from source – or even owning the source. Microsoft recently announced a 20-year agreement to purchase all the electricity generated from a 110-megawatt (MW) Texan wind farm. Google has announced a deal to buy 240MW of electricity from a wind farm, also in Texas. Ikea now owns 137 wind turbines having recently added a 7.65MW Irish wind farm to an already impressive portfolio in its goal to become totally energy independent by 2020.
This, not the token photo opportunity, is the driver now. It may be propped up by FITs, ROCs, and a current glut of third-party developers. Take those away overnight and "the price indicators wouldn't be there", as Mr.Chadwick comments. But those fixed energy costs are becoming more and more attractive. And as the technology rapidly improves, the market for on-site renewables could become self-sufficient soon enough.

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