Salesforce buys 280,000 MWh of blockchain-based RECs
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Customer relationship management company Salesforce has entered into a contract with renewables developer Powertrust for 280,000 MWh certificates for renewable energy over the next eight years.
The purchase is in the form of Distributed Renewable Energy Certificates (D-REC), a new financial mechanism designed to support the growth of distributed small-scale projects in emerging markets.
D-REC’s initiative was launched by Powertrust and South Pole Carbon Asset Management in 2020 as what was intended to be an international mechanism for certifying and valuing distributed renewable electricity projects.
As such, it represents an extension of the long-standing REC market, but while a REC represents 1MWh, a D-REC represents 1kWh.
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Subsequently, the D-RECs have become a multi-stakeholder open source initiative and have been recognized by the United Nations Development Program to support progress towards Sustainable Development Goal 7 on universal access.
With the purchase, Salesforce is committing to match 100% of its electricity use with renewable energy, and the investment is expected to generate an estimated $65 million in distributed projects in countries including sub-Saharan Africa and Southeast Asia.
“Almost 95% of the company’s purchases of renewable energy today take place in North America and Europe. We need to make sure the rest of the world is not left behind, said Megan Lorenzen, who leads power sector decarbonisation for Salesforce.
The focus of Salesforce’s D-REC’s purchase will be on acquiring projects in non-traditional markets where they can help deliver social and environmental benefits.
Potential projects within this portfolio include solar-powered microgrids for remote communities along the Amazon River in Brazil and in a mountainous area in eastern India, a solar storage installation at a hospital in an African country and a solar-microhydro coupled installation in rural Malaysia.
As part of its decarbonization activities, Salesforce is also a member of the Emissions First Partnership, which calls for accounting standards to change to allow support for corporate purchases outside the traditional markets of North America and Europe.
D-REC is not in itself a standard, but is closely adapted to the international REC standard. The D-REC platform includes both off-chain and on-chain components, with the latter built on the Energy Web chain.
