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Google and EDPR NA Distributed Generation have entered into a framework agreement that supports the development of more than 80 distributed solar PV projects with a total capacity of 500 MWAC. The agreement is in line with an environmental justice program that benefits over 25,000 families in low-to-moderate income (LMI) communities. The focus will initially be on projects in the PJM Interconnection service area, which spans from New Jersey to Ohio. The first projects will be constructed in Ohio, where Google has a data center campus in New Albany and a Google Cloud region in Columbus.
According to S&P Global and BloombergNEF data, the transaction with Google represents the largest corporate sponsorship of distributed solar development in the United States. The initiative is called the Clean Energy Financial Benefit Sharing Program and will be financed in part by Google’s purchase of a new type of renewable energy credit called the ImpactREC.
Similar to traditional Renewable Energy Certificates (RECs), the ImpactREC is produced in the applicable compliance market and is eligible for it. However, its issuance includes additional agreements that certify direct community investment and benefit to low-to-moderate income (LMI) groups. The ImpactREC program provides economic benefits comparable to community solar in regions without supportive regulations. The EDPR NA DG team, led by Christopher Rittenhouse and Adam Woda, partnered with Google to conceive and develop the ImpactREC and its framework agreement over the past two years.
Sana Ouji, Energy Lead at Google, stated that the disproportionate impact of high energy burdens is a significant obstacle to an equitable energy transition, according to feedback from local community leaders and environmental justice advocates. She said that partnering with EDPR NA DG aims to decrease energy burdens in the areas where they operate while working toward Google’s 24/7 carbon-free energy objective. Google and EDPR NA DG have committed to local social and economic justice in the transition to a sustainable future.
Aside from the ImpactREC purchase, the program includes a $12 million community impact fund that concentrates on projects that reduce energy poverty in the regions where the projects are located. Richard Dovere, Chief Investment Officer of EDPR NA DG, stated that the partnership with Google establishes a new corporate-led market segment that concentrates on overcoming the typical obstacles to rapid, distributed, and equitable decarbonization of the energy system. He added that a significant aspect of this collaboration is its transparent approach. The blueprints for the ImpactREC will be released to the market in the coming weeks to make it the primary incentive methodology for localized renewable development associated with environmental justice.
The Inflation Reduction Act (IRA), passed in 2022, has helped make this initiative possible. It contains landmark tax incentives for domestic energy production and manufacturing, which the ImpactREC uses to make direct investments in communities throughout the Midwest and Northeast and enable economic benefits for LMI communities.
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