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SR Inc is pleased to officially announce that the virtual power purchase agreement (VPPA) with which we assisted Member-Clients Intuit and Cisco in 2018 and 2019 is now operational.  SR Inc’s Renewable Energy Procurement Services (REPS) led the selection process to identify new, additional renewable energy capacity for multiple SR Inc Member-Clients to contract.  As an outcome of this process, Intuit and Cisco contracted for a portion of the 419-megawatt (MW) Mesquite Star wind farm in Fisher County, Texas.  

Intuit – makers of TurboTax, QuickBooks, and Mint – and Cisco – the worldwide leader in networking for the internet – both contracted for 10 MW under the VPPA.  Along with commitments from Lowe’s, Ecolab, and Brown University, these commitments enabled Clearway Energy Group to finance the development and construction of the new wind generation capacity.  The 20 MW of wind generation capacity contracted by Intuit and Cisco provide enough annual electricity to meet the demand of 6,500 average U.S. homes.  Cisco and Intuit’s agreement will enable Cisco to achieve its goal of 85% renewable energy by 2022 two years early and will enable Intuit to achieve its goal of 100% renewables by 2030 – ten years early. 

SR Inc REPS assisted Intuit and Cisco in shared transaction structuring, market, financial, legal, regulatory, engineering, and contracting advisory services for more than 12 months as Intuit and Cisco signed the VPPA.  SR Inc REPS managed a national request for proposal process for Intuit and Cisco, which involved more than 20 qualified leading developers proposing more than 50 individual projects across six different U.S. energy markets.  We provided a five-level risk analysis that examined the relative risks associated with distinct U.S. markets, developers, technologies, projects, and legal terms and provided collective and individual financial modelling of likely forward financial performance in 13 different forward scenarios.  The process resulted in all seven finalists offering market leading terms to tailor the buy-side aggregated VPPA – what SR Inc REPS styles a “VPPA 2.0” – to the risk adverse needs of corporate off-takers like Intuit and Cisco. 

Each corporate off-taker is 100% legally and practically independent of each other.  Consistent with evolving VPPA terms, the developer is exclusively responsible for the financing, development, operation, as well as the sale of the physical energy into the local wholesale market.  Cisco, Intuit, and the other corporate off-takers agree to purchase the RECs that the developer is responsible for certifying.  These are considered Purchaser-Caused Bundled RECs since the long-term contract with the corporate off-takers enabled the developer to finance the additional capacity to produce the renewable energy the RECs represent.  

Sean Kinghorn, Intuit’s Global Sustainability Leader stated: “Intuit is committed to delighting our customers and they have made clear they would like us powered by renewable energy.  We have appreciated the SR Inc REPS team’s leadership in helping to create a model of shared services and buy-side aggregated VPPAs that has the potential to deliver cost-positive renewable energy for every enterprise that is creditworthy and able to make a long-term commitment to cause new renewable energy.  It has made it possible to meet our goal of 100% renewable energy ten years early and to move to a more aggressive goal: climate positive ‘50 times by 30’ target that would result in a reduction of 2 million metric tons of carbon dioxide by 2030.”

Andy Smith, Cisco’s Senior Manager of Global Energy Management & Sustainability stated: “Renewable PPA agreements allow Cisco to support new renewable energy developments that produce electricity bundled with the associated RECs.  This helps us meet our sustainability goals and reduces costs and volatility in our energy budget by locking in electricity prices over the term of the agreements.  Furthermore, it creates local jobs and adds clean, renewable electricity to the local electric grid where we have operations.”

Jim Boyle, SR Inc’s CEO & Chairman remarked: “Intuit and Cisco have provided important cross industry leadership.  They have demonstrated how enterprises can partner with others to leverage shared support services – such as those provided by SR Inc REPS’ Net Zero Consortium for Buyers – to enable each individual enterprise to make substantially smaller but still independent commitments. Intuit and Cisco did this while still: (a) causing new renewable energy capacity; (b) winning market-leading contractual protections; and (c) benefiting from the cost advantage of utility scale renewable energy.  Currently, other SR Inc Member-clients are in negotiations for another VPPA 2.0 also providing a no necessary first capital, likely cost positive contract for more credible RECs caused by their purchase.   It is now reasonable for most large, high credit enterprises in the U.S. to benefit from the cost advantage of utility-scale renewable energy and to seek to also chart a profitable path to 100% renewables.”