If you’ve ever been on either end of a real estate deal, you’ve probably heard this old saying: “location, location, location.” This potentially overused adage imparts some obvious but useful lessons. For example, if you’re a small business owner investing in a new store, buying in one part of town versus another can be a complete game changer for how much money you’re able to make and how many people your business can reach, even if the service you’re providing in either location is identical.

The same concept holds true for solar projects and potential avoided carbon emissions. In fact, our research has shown geographic location to be the most important factor in determining the emissions impact of a new  renewable energy project.

The idea is fairly simple: If you build a new solar farm in a region that’s already saturated with—and maybe even curtailing surplus—solar energy, it won’t reduce grid emissions nearly as much as a solar farm built in a region still mainly reliant on coal-fired electricity. What you displace matters, and our goal is to displace high-emissions electricity generators. At WattTime, we call this concept “emissionality,” and according to our research, using the practice of emissionality when siting new renewables projects can help us avoid up to 380 percent more greenhouse gas emissions.

While location is clearly the heavy hitter of solar project optimization, there are other aspects to factor into the equation. One that we’ve recently taken a closer look at, along with our partners at utility-scale solar company First Solar, is the idea of “embodied emissions.” Different types of solar generation hardware cause different quantities of carbon emissions during production, deployment, and over their lifespans. For example, silicon technologies—especially monocrystalline—result in a higher emissions impact because of more emissions-intensive material and manufacturing requirements. But thin film technologies have a much lower emissions impact throughout their lifespans. By calculating the amount of avoided emissions achieved through strategic siting minus the emissions created through the lifespan of the technology deployed, we’re able to consider the overall net emissions impact of various projects.

A new report from WattTime and First Solar explores the net emissions impact of four common solar PV technologies in three different regions of the world with vastly different grid mixes—France, North Carolina, and California—across a typical 25-year lifespan. Spoiler alert: all the systems we tested had a net emissions reduction impact over a period of 25 years, but some were much better than others. The most dramatic swings in avoided emissions, as expected, were found when solar projects were placed in fossil-fuel-heavy grids compared to cleaner grids. Projects in North Carolina—where the marginal power generator is usually coal or natural gas—displace nearly 15 times more emissions than projects in France, where marginal generators are usually low-carbon.

But when working in relatively clean grids, using solar technologies with lower lifecycle embodied emissions helped make a great thing into an even greater thing. If we look again at France, using cadmium telluride technology instead of monocrystalline amplified net emissions reductions by a factor of nearly three.

As more of our electricity grids make the gradual transition from fossil fuels to renewables, thinking strategically about what technologies we use and where we put them can help us meet carbon reduction goals on or ahead of schedule. For more takeaways, as well as a deep-dive into lifecycle analysis and the concept of displaced emissions, download the full report.

Once upon a time, when renewables produced a negligible amount of electricity and fossil-fueled power grids were essentially “always dirty,” adding new renewable energy wherever and whenever was a reasonable strategy. You could be more or less assured that your new renewable generation would be displacing emissions from a polluting power plant somewhere.

But we’re increasingly seeing that when renewables generate their electricity is beginning to matter, and sometimes a lot. The coincident timing of tons of daytime solar PV generation is behind California’s infamous Duck Curve. Likewise, coincident timing is also behind ERCOT’s curtailment of surplus overnight wind generation in Texas and occasional dips into negative wholesale power prices. 

(Annual wind curtailment in ERCOT peaked in 2009 around 17%. Transmission expansion helped bring that number down to an estimated ~2% in 2019, but that number was expected to start creeping upward again into 2020 as a large amount of new wind capacity came online at the end of last year.)

Now, a new WattTime analysis shows that the timing and overall generation shape of new renewable energy capacity can have a big impact on the avoided emissions staying power—or not—of various renewable technologies (see Figure 1). This in turn can have a big influence on how rapidly we’re able to decarbonize U.S. electricity grids.

Solar’s diminishing returns vs. wind and geothermal’s staying power

WattTime analysts Christy Lewis and Henry Richardson looked at California’s grid out through year 2044 to better understand the avoided emissions rates of solar PV, wind, and geothermal technologies. In other words, when you looked at the grid’s carbon emissions rate vs. their respective generation shapes, how much emissions would they displace at any given point in time.

Spoiler alert: not surprisingly, the emissions rate during midday hours eventually sunk toward zero, as solar energy saturated the grid. For that same reason, the avoided emissions value of building yet more solar also sunk over time. It was a classic case of diminishing returns. The more that previously installed solar already reduced daytime emissions, the less value adding yet one more megawatt of solar would have for that grid. It’s a kind of merit order effect, only for emissions rather than economics.

On the other hand, when Lewis and Richardson looked at geothermal and wind, they found that both of those renewable technologies had real staying power when it came to avoided emissions. In the case of wind power, it was a byproduct of serendipity. Wind generation in California happens to naturally peak at the same time as grid emissions, so adding more wind capacity continues helping to chop that emissions peak down. For geothermal, it was about its always-on and/or dispatchable nature. Geothermal is able to generate during all those “forgotten,” overlooked times of the day and night when solar and wind aren’t producing. It covers critical gaps in the generation profile of a 24-hour day, and thus also has staying power (see Figure 2).

Is it geothermal’s time to shine in the U.S.?

Think “geothermal energy” and you probably think of a place such as Iceland. And for good reason: it’s a world leader, with geothermal accounting for fully two-thirds (66%) of the nation’s primary energy use and 25% of electricity production. Compare that to the U.S., where geothermal accounted for just 0.4% of electricity generation in 2018.

But although geothermal is small in the U.S. today—and although wind, solar, and storage capture much of the spotlight—geothermal could play a much larger and crucial role in the country’s future electricity system as a vital part of a broader renewable portfolio.

The U.S. currently has about 2.5 GW of operating geothermal capacity. Compare that to a whopping 105 GW of installed wind capacity and 71 GW of installed solar capacity. Some 95% of the geothermal capacity is in just two states: CA and NV. And nearly half the capacity came online in the 1980s. However, that all could change. A 2008 USGS survey identified nearly 40 GW of hydrothermal potential for electricity generation. And half of U.S. states specifically allow for geothermal as an approved way to meet RPS targets.

Moreover, a number of promising startups gaining momentum, including Fervo Energy, backed by heavyweights such as Breakthrough Energy Ventures, Berkeley’s Cyclotron Road, U.S. Department of Energy, and Stanford University.  

Geothermal vs. “mainstream” renewables solar and wind

Like wind, solar, hydro, and other renewable energy technologies, geothermal is a form of emissions-free electricity generation. But that’s about where the comparison to other renewables stops.

For starters, U.S. geothermal electricity production has boasted an average capacity factor around 76%, while newly constructed plants can approach 100%, only furthering the juxtaposition vs. wind and solar.

Second, there’s the issue of generation shape. Because of geothermal’s high capacity factor, some think of it as a kind of always-on baseload renewable generation. Others instead characterize it as dispatchable renewables that can be ramped up or down (without the need to pair it with an energy storage system, as in the cases of wind and solar).

Finally—and to the point of the recent WattTime analysis—there is the matter of avoided emissions, a topic that becomes even more important in the years ahead as the U.S. adds more renewables to the power grid en route to a low-carbon electricity system. Because geothermal can generate electricity pretty much continuously, and perhaps more importantly, because geothermal can produce energy when wind and solar can’t, it retains its avoided emissions value out to 2030 and likely beyond.  

Renewables and the climate crisis

As we collectively look ahead to renewable energy project pipelines, there remains the issue of where to build new renewable capacity (a concept WattTime calls emissionality). But increasingly, there will be growing importance on paying attention to generation shapes and when a particular renewable technology can inject clean energy into the grid and help slash the fossil-fueled emissions rate. 

This suggests a strong growing role for geothermal and a continued important role for wind, as solar’s diminishing returns on avoided emissions in places like California mean we’ll have to look elsewhere for “getting more of the carbon out” of our power grid. That’s not to say by any means that the sun is setting on solar. It will continue to play an important role in today’s and tomorrow’s electricity system. 

But as more grids mature in their transition from fossil fuels to renewables, getting the carbon emissions out of the system as quickly as possible will require a more careful look at when renewables generate their electricity and how much emissions they’re displacing when they do.

In the ancient past of corporate sustainability initiatives—like, say, five whole years ago—the concept of “additionality” gained traction and fundamentally disrupted the long-standing practice of companies buying unbundled renewable energy certificates (RECs) as the leading way to demonstrate their commitment to clean energy. Additionality came along and set a new bar: corporations could sign power purchase agreements (PPAs), whether direct/physical or virtual, that enabled new large-scale wind and solar energy to get built and added to the U.S. power grid. It has undoubtedly been an overwhelming force for good. Between 2015 and August 2019, corporations signed contracts for a staggering 17.7 GW of new renewable energy, according to the Renewable Energy Buyers Alliance Deal Tracker. And the investments continue. Just last month, telecom major T-Mobile announced a quintet of contracts for solar and wind projects in three U.S. states: Virginia, Illinois, and Texas. Meanwhile, also last month tech giant Google announced perhaps the largest corporate renewable investment ever: $2 billion invested in 1,600 MW of wind and solar projects spread across 18 projects in the U.S., South America, and Europe. All of which begs the question: Is new “steel in the ground” the end game ? Or do some investments mean more than others?    A new wave of innovation reaches corporate renewables purchasing RECs bundled with PPAs that pass additionality muster remain the standard, especially for the largest buyers that have the demand, credit worthiness, and resources to source such contracts. But with the climate crisis only deepening, we’re now seeing a new wave of innovation to make renewables drive even more impact. As with the decommoditization of electricity, which looked beyond treating all raw kilowatt-hours the same and started to differentially care about the source of those electrons (e.g., coal, natural gas, wind, solar), we’re now arguably seeing a decommoditization of the PPA. In this unfolding new era of corporate renewables procurement 2.0, we’re starting to see some buyers look beyond the raw PPA. There’s an increasing understanding that all renewable PPAs are not created the same. And I’m not merely talking about common contractual details: price, term length, wind vs. solar. More importantly, I’m talking about location. Where new renewable energy projects get built matters, not in terms of proximity to a corporate buyer’s facilities, but rather in terms of the positive impact a new wind or solar farm will have on grid emissions. And those impacts can be significant: Holding all else equal (e.g., project budget, MW build side, interconnection possibilities), the practice of emissionality, according to WattTime research, can achieve up to a 380% increase in avoided GHG emissions. “Here at WattTime, we’ve started calling this concept ‘emissionality,’” says co-founder and executive director Gavin McCormick. “Like additionality, it’s a way for renewable energy buyers to ensure their purchases are really driving impact. But it’s a more quantitative way of thinking about impact: by directly comparing the real-world drop in fossil fuel emissions that different renewable energy projects cause.” The idea is straightforward: Although renewable energy itself is by definition always emissions-free, where such projects get built greatly influences their true net impact on overall grid emissions. For example, yet another wind farm in a region of the country already saturated with—and perhaps even curtailing surplus—wind energy isn’t going to reduce total electricity sector emissions as much as a solar farm built in a region of the country where its output will displace coal-fired electricity. Emissionality was the driving force behind Boston University’s wind power purchase announcement in September 2018. The university looked beyond the New England region and ultimately signed a contract for a project in South Dakota. That’s because BU’s 2017 Climate Action Plan targeted carbon neutrality by 2040, which included a focus on buying wind and solar energy to offset its electricity use and, crucially, seeking out projects that would reduce emissions as much as possible. In other words, BU didn’t just want renewable energy; it wanted renewable energy that could deliver the greatest emissionality benefits, too.   Clearloop is putting the spotlight on emissionality Until now, examples like BU’s have accounted for only a minority of the corporate renewable PPA market. But there are signs that emissionality is gaining momentum. For one, new entrant Tennessee-based startup Clearloop—which is already getting a fair amount of buzz—is the first to make it core to their offering. Rather than offer renewable PPAs against a corporation’s overall electricity consumption, Clearloop is offering renewables-based emissions offsets at the product level.  As a hypothetical, imagine that a shoe company wants to offset the carbon emissions associated with producing a particular line of sneaker. Once the company has calculated that emissions number, it can go to Clearloop to source an equivalent amount of avoided emissions, rooted in new renewable energy projects built around the country. It’s an intriguing twist on corporate renewables procurement. Corporations are typically accustomed to buying renewable energy on a MWh basis. Through Clearloop, they’re instead essentially buying renewables on an avoided emissions basis. This naturally lends itself to putting emissionality into practice. In order for Clearloop to offer its customers the biggest bang for their buck, it will naturally seek to build new renewable energy projects in those regions of the country where they can achieve the biggest avoided emissions. “The grid is not equally dirty across the country, so we saw opportunities to build renewable energy in places where it can have the best impact,” says Clearloop co-founder Laura Zapata. “Rather than tying carbon offsets to something less tangible and less connected to everyday actions, like trees planted, we’re basically leveraging companies’ desire to invest in carbon reductions and connecting it more directly to tangible renewable energy projects.”Accounting for emissionality of a project still has a way to go before it becomes a central factor in corporate renewable investment decision-making. But it clearly is making inroads. There’s growing recognition that better siting of new wind and solar projects can achieve deeper reductions in grid emissions, rather than adding yet more renewables to those regions that already have it in spades.