As concern for the environment grows, both consumers and stakeholders are pushing companies towards developing long-term sustainability goals. Organizations looking for innovative, economic, and impactful ways to meet major sustainability commitments has led to a rapid increase in corporate renewable energy procurement. But how can organizations effectively communicate everything they’re doing to support clean energy usage? By engaging in sustainability marketing.
What Is Sustainability Marketing?
Sustainability marketing, also known as renewable marketing, green marketing or green PR, is a type of marketing strategy that focuses on an organization’s commitment to the environment by promoting its sustainability efforts. Developing the right green marketing strategy can have a huge impact on securing investors, cultivating loyal consumer relationships, hiring and retaining employees, and gaining a competitive edge.
Using RECs to Create Green Marketing Strategies
In order to demonstrate their investment in renewable energy, companies acquire Renewable Energy Credits (RECs), which is the mechanism that allows a buyer to claim the renewable benefits of a clean energy project. The EPA defines a REC as the property rights to the environmental, social, and other non-power qualities of 1 Megawatt Hour (MWh) of renewable energy generation. Solar Renewable Energy Credits (SRECs) are a form of RECs which represent the attributes from solar projects.
How a company procures RECs is extremely important as this can frame or, in many cases, limit how the company can market their renewable energy efforts. In the past, companies were able to make broad green marketing claims regarding their renewable energy usage. But now, the market,and many market participants, will evaluate or even police these claims to ensure that the company is accurately representing its impact.
It can’t be overstated enough that your REC purchases need to support your sustainability marketing claims. There are many 3rd-parties and competitors that will evaluate your green PR claims and check to make sure that they are accurate. There are a plethora of examples of large companies whose green marketing efforts backfired due to misrepresentation.
The Three Ways to Purchase & Market Renewable Energy Credits
Renewable Energy Credits (RECs) can be purchased three ways; through a Direct purchase, through a Power Purchase Agreement (PPA), or through a Utility sponsored program.
Direct purchase — Least opportunity for green marketing
Purchasing RECs directly is a popular option but gives you the least opportunities to engage in sustainability marketing. Often, these RECs are called “unbundled”, meaning they are not specific to a particular renewable energy project. Unbundled RECs are widely available at very low cost, and in some cases represent electricity generated from “dirty” resources such as trash incineration. The availability and low cost of these unbundled RECs means that your REC purchases didn’t support the construction of a new Renewable Energy project, so there’s no way to claim additionality. This also limits your efforts real impact and any claims that you might make related to these sustainability efforts.
Utility programs with RECs
Across the country utilities are responding to customer demand by creating programs to purchase renewable energy through new tariff structures, often called Green Tariff Riders. One example of this would be a utility tariff that adds a rider to utility bills for the purchase of renewable energy. As part of the tariff, the utility transfers RECs from a renewable project to the customer. In Virginia, Dominion Energy created Schedule RF for this purpose. These tariffs, depending on their particular structure, provide large customers a way to procure renewable energy and make green marketing claims. The downside is that utility tariffs are often more expensive. Depending on the program, the RECs may come from new renewable energy facilities, giving you the opportunity to claim additionality, in other cases the program may not. It is important to understand the specifics of the program to confirm the extent of the claims you can make based on your purchase, and get transparency about what type of generation produces the RECs.
Entering into a PPA with bundled RECs — Most opportunity for Green PR
Purchasing RECs by entering into a PPA gives your organization various green marketing opportunities, and it’s the most cost effective way to buy RECs. By entering into a traditional Power Purchase Agreement (PPA), or Virtual Power Purchase Agreement (VPPA) — that includes transfer of the project specific RECs — an organization can verify the exact source for those RECs. Plus, because of the significance of signing a PPA with a project, and that projects ability to secure financing and be built, you will be able to claim additionality. Additionality means that, without your organization’s investment, the renewable energy project otherwise would not have been constructed. This can be a powerful statement to consumers and stakeholders.
PPAs ensure all green marketing claims originate from the real, measurable impact of an organization’s investments in procuring RECs or renewable energy. There is definitely a wide spectrum of impact. It ranges from the minimal value of a low cost REC with no additionality, to procuring RECs from a renewable energy project in close proximity to your facilities. As mentioned above, additionality is a key criterion in evaluating the impact of your investment and the claims that you can publicly make. To take it a step further, many companies try to procure RECs in the areas or power grids where their facilities are located in order to support even stronger claims of impact. Companies like Amazon and Facebook try to match their renewable energy procurement to the region or grid where they have facilities that are consuming the power. While this is an emerging trend, it is not a widespread practice.
Promoting REC Purchases Through Sustainability Marketing
Now that you know how purchasing your RECs can make a difference on what you can claim, let’s talk about some of the must-have elements of green marketing strategies.
Renewable Marketing is All About Knowing Where and How to Publicize
There are plenty of places you can publicize your efforts to support the sustainability movement. To develop a successful green PR strategy, try to get your message out across as many platforms as possible, while keeping it consistent and on-brand. Some of these places include:
- Company/Corporate Websites
- Company Social Media Pages (Twitter, FB, LinkedIn, etc.)
- The RE Project’s Developer Site
You can also join groups that match your goals, and report your efforts to important organizations to gain increased exposure. Some of these groups include:
- The RE 100
- Renewable Energy Buyers Alliance (REBA)
- Corporate Renewable Energy Buyer’s Principles
- The Green Power Partnership
When it comes to large off-site Renewable Energy projects, there are usually multiple organizations involved in the investment. Leveraging each other’s reach and doing a series of press releases that can be published across all sites is a great way to publicize your renewable energy purchase. Oftentimes, groups involved with an RE project will also go on press tours; speaking on panels and at conferences related to their project.
Elements of a Green Marketing Mix
Once you’ve narrowed down what you’re going to say, how to frame it, and where to publicize it, it’s time to get creative with your green marketing mix. Contrary to popular belief, a green marketing strategy doesn’t need to be restricted to Press Release type-content. It can be anything; from images to community stories, to an email outreach campaign from the CEO.
When publishing anything on social media especially, your content must stand out to get noticed. Use high-resolution images with short, powerful messaging. The more visual content you release, the better the engagement will be. If you have video content available, leverage that as well. Focus less on the technical aspects of the renewable energy project and more on the direct impact it’s making. Also, whenever possible, use numbers, percentages, and statistics to tell your story and make your green marketing message more tangible.
Example: We’ve committed to offsetting 100% of our energy usage with solar power by 2020, and this new project gets us 80% there!
In the U.S., the FTC has also published a series of “Green Guides” for the use of Environmental Marketing claims. These renewable marketing guides explicitly outline all the rules and restrictions around sustainability marketing claims, so you can avoid greenwashing and remain compliant.
How To Avoid Greenwashing In Your Renewable Marketing Efforts
Greenwashing refers to making exaggerated, deceptive, or false claims about corporate environmental efforts. There are a lot of ways to procure renewable energy and be creative in promoting it, but how your green marketing statements are framed makes a huge difference in how the company is perceived. If anything is framed incorrectly, or is outright dishonest, you can run into serious legal issues.
A great way to make sure you don’t accidentally engage in greenwashing is to consult industry experts and key stakeholders. Ask them to review your green PR communications and green marketing materials to help ensure that they are accurate and adhere with industry standards and best practices — including the FTC’s Green Guides. Experts and stakeholders could include individuals from third party certification programs, your legal counsel, or your project developer.
As a utility-scale solar project developer, Urban Grid has the experience needed to make sure your sustainability marketing efforts are truthful and compliant. We can help position your green marketing strategy in a way that conveys the message you’d like to get across, while staying in the confines of what you’re legally allowed to claim.