Renewable Energy Procurement Guide for Businesses

Let's be honest 

What's the first thing that comes to mind when discussing procurement? 

Pricing? 

Suppliers? 

Negotiations?

A dozen additional processes? 

We bet you never think about renewable energy.

Well, in some industries, market procurement is also becoming one of the most powerful levers for driving sustainability.

The method?

Begins by focusing on renewables.

What is Renewable Energy Procurement? 

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Procurement is complicated as it is. 

So, how exactly does renewable energy procurement work? 

It's basically the process of moving from traditional energy sources to clean, renewable ones.

Instead of relying on fossil fuels, you’re making a conscious choice to move into greener energy.

There are two main ways this usually happens:

Direct procurement: 

Your company signs an agreement to buy renewable power straight from the source (like a wind farm or solar developer). 

This gives you a tangible connection to clean energy, often through long-term contracts such as Power Purchase Agreements (PPAs).

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Indirect procurement: 

This is a hybrid approach. You're not buying the energy itself, but rather the environmental benefits tied to it. 

This usually comes in the form of Renewable Energy Certificates (RECs) or offsets, which allow you to claim progress toward sustainability goals even if the actual electrons you use are still coming from the grid’s mixed supply.

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Why Renewable Energy Procurement Matters 

Environmental impact

Bear in mind that going for renewable energy isn't something that can be done overnight, so it's better if you are doing it with the mindset that renewable energy is how you show your appreciation for the planet.

Every kilowatt-hour you source from renewables helps shrink your carbon footprint. 

For companies with net-zero commitments, procurement becomes one of the most direct ways to reduce emissions at scale.

Economic benefits

No, going green isn't a luxury few can afford.

Not if you look at the picture closely, at least.

Fuel prices can change like crazy in a minute, and given our current political situation, that's not an exaggeration. In most countries, you'll also find bonuses and tax reductions if your company works with renewables.

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And isn't one of the goals of procurement to save money? 

Reputation and compliance

Do you want to increase your reputation in the market? 

Are you wondering how to attract the best Investors and keep your customers around? 

Stick with renewable energy. 

Stakeholders are watching. Investors, regulators, and even your customers want to see real action on sustainability, not just talk.k

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Procurement Models for Renewable Energy 

There’s no one-size-fits-all way to bring renewables into your procurement strategy. The right model depends on your company’s size and energy requirements 

Here are the main options:

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Power Purchase Agreements (PPAs)

Are you considering a large investment? 

Do you run a global company? 

PPAs are long-term contracts where your company agrees to buy electricity directly from a renewable energy developer, like a solar farm or wind project. 

They’re popular with large corporations that want guaranteed access to green power.

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Pros:  Lock in predictable energy prices, directly support new renewable projects, and have strong ESG credentials.

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Cons: Long-term commitments plus complex legal/financial structures, making it best suited for bigger businesses with high energy usage.

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Green Tariffs

Okay, but what if you are a growing business? 

Let's talk green tariffs.

Depending on your location, you'll find that some utilities offer “green tariff” programs, where you can opt into renewable energy through your regular utility bill. 

This is often the simplest route for companies that want clean power without the complications of managing additional contracts.

Pros:  Super simple to set up, accessible even for smaller businesses, no need for a large upfront investment.

Cons: You won't have as much control over energy sourcing, and it usually comes at a premium price compared to standard tariffs.

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Renewable Energy Certificates (RECs)

RECs are tradable certificates that represent proof renewable energy was generated on your behalf, even if the actual electricity powering your office is a grid mix.

Pros: Highly flexible, scalable, relatively inexpensive, easy to buy on the open market.

Cons: They don’t guarantee you’re using renewables directly, and are sometimes criticized as “paper compliance” rather than true impact. This might not be a good signal in front of your customers 

On-site Generation

Think rooftop solar panels, small wind turbines, or other systems installed right at your facilities. You generate your own power and reduce your reliance on the grid.

Pros: Maximum control, visible sustainability commitment, long-term cost savings.

Cons: High upfront investment, site and infrastructure limitations, and ongoing maintenance responsibilities.

Challenges in Renewable Energy Procurement 

• Market complexity & legal frameworks: Energy markets and regulations vary widely, making navigation tough.
  
  
• Upfront cost & financing: On-site projects or long-term deals often require significant capital.
  
  
• Contract risks: PPAs and similar agreements lock you in for years—great for stability, but not for flexibility.
  
  
• Supply & demand mismatch: Renewables are intermittent, so aligning your energy needs with generation isn’t always straightforward.

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