Oct. 25, 2023
Sun Trinity to begin supplying AGC Group with electricity derived from a renewable energy sourceSeeks to help spread renewable energy through its first off-site solar power corporate PPA
Sumitomo Corporation has entered into an off-site solar corporate PPA (Note 1) with AGC Techno Glass, a wholly-owned subsidiary of AGC Inc., through Sun Trinity LLC, in which Sumitomo Corporation and Shikoku Electric Power Company are co-investors. Under the corporate PPA, Sun Trinity will supply AGC Techno Glass' Headquarters and Shizuoka Plant with renewable energy having additionality (Note 2) generated by Sun Trinity's new solar power plant in Shizuoka Prefecture (with a generating capacity of approximately 2 megawatts) for the next 20 years; the amount of electricity to be supplied is equivalent to approximately 10% of the company's annual electricity consumption. This marks Sun Trinity’s first foray into renewable energy power supply through an off-site solar corporate PPA.
Amid rising expectations of the role of solar power generation in helping achieve the Japanese government's goal of carbon neutrality by 2050, corporate PPA projects, in which power providers install and operate solar power generation facilities on behalf of customers and sell the power and environmental value to those customers, are rapidly gaining popularity. One issue facing the on-site solar power corporate PPAs currently constituting the mainstream, however, is that the use of customers’ premises limits the capacity of the power generation facilities that can be installed.
Accordingly, off-site solar corporate PPAs under which renewable energy is procured from outside customers' premises are garnering attention. These are expected to provide a major boost to carbon neutrality, as they will eliminate site constraints, increase the amount of renewable energy that consumers can procure, and enable companies that cannot install solar power generation facilities on their premises due to site size, roof shape, or other factors to introduce renewable energy.
Sun Trinity as a company contributes to decarbonization by promoting consumer use of renewable energy through the development and operation of solar corporate PPA projects. Off-site solar corporate PPAs require the securing of project sites and complicated coordination with power retailers, so Sun Trinity is undertaking development by leveraging Sumitomo Corporation’s and Shikoku Electric Power Company's knowledge of the electric power business cultivated over many years and their extensive domestic business infrastructure. Its aim is to develop more than 1 gigawatt of renewable power generating capacity by 2030 by providing customers with optimal renewable energy and environmental value through such means as off-site solar corporate PPAs.
The Sumitomo Corporation Group has set a goal of making its business activities carbon neutral by 2050, and it is engaged in projects across a broad spectrum – encompassing hydrogen, storage batteries, electric vehicles, forests, CCUS, etc. – to reduce CO2 and other emissions and recycle carbon, in addition to promoting renewable energy. As an important method for supplying clean energy that does not emit CO2, the solar corporate PPA business will play a part in bringing about a carbon-neutral society.
(Note 1) :
A corporate PPA (Power Purchase Agreement) is a contract under which a company purchases electricity from a power producer over an extended period of time. There are two types of PPAs: on-site solar corporate PPAs, under which the power provider installs and operates power generation facilities on the customer's roof or site and sells the power and environmental value to the customer, and off-site solar power corporate PPAs, under which the power provider installs and operates power generation facilities away from the customer's facilities and sells the power and environmental value to the customer via the power grid. These PPAs require no initial investment or management costs for consumers and allow for stable power procurement over the long term.
(Note 2) :
Additionality refers to directly contributing to an increase in total renewable energy generation through the development of new renewable energy sources.