Corporate buyers have led to the voluntary procurement of over 40% of the total capacity of U.S. solar and wind projects from 2014 to 2024. A report from the Clean Energy Buyers Association shows how corporate procurement drives the renewables market and mitigates project financial distress.
September 30, 2025
Over the past ten years in the United States, the voluntary action by corporations to directly procure renewable energy contracts has been a primary driver of growth. Leaping out ahead of the adoption curve by electric utilities, corporate buyers are driven by goals of reporting lower carbon emissions and securing stable electricity prices for 20 years or longer.
A report from the Clean Energy Buyers Association (CEBA) said that over 100 GW of clean energy deals have been procured by corporate buyers from 2014 to 2024, representing 41% of all clean energy capacity added to the grid over that period.
Take Microsoft, for example, which announced in 2024 the largest-ever corporate power purchase agreement for renewable energy, signing on for more than 10.5 GW of capacity in the United States and Europe. The projects are slated to begin construction in 2026. Bloomberg NEF estimates the portfolio will take over $11.5 billion to build.
As artificial intelligence datacenters scale up, electrification of buildings and transportation increases and U.S. manufacturing ramps up, electricity demand is set to take off, paving the way for corporate energy contract buying to keep chugging along. Grid Strategies LLC forecast that electricity demand will increase 16% in the next five years after remaining relatively flat for several years, growing the overall market size considerably. Factoring in corporate and state procurement goals, many of which target net-zero by 2050, the potential for growth remains massive.
What’s more, the buying power of corporations provides significant stability for renewable energy project developers.
Along with renewable data company REsurety, CEBA analyzed the economic performance of 251 wind and solar projects across three major power markets, including the Electric Reliability Council of Texas (ERCOT), Midcontinent Independent System Operator (MISO), and PJM Interconnection, three of the largest renewable power markets, where over 70% of future corporate procurement is forecast to take place.
It found that virtual power purchase agreements (VPPA), the leading contract structure for corporate renewable procurement, reduce the number of projects facing “financial distress” defined as a negative cash flow, by 90% in MISO and PJM and 80% in ERCOT.
“Corporate buyers are the backbone of clean energy deployment, anchoring project financing and shaping the future of reliable, cost-effective power,” said David Groleau, vice president of Pine Gate Renewables, a developer, owner and operator of utility-scale solar and energy storage projects.
Unlike fossil fuel generators, wind and solar projects have low operating costs but relatively high capital expenditures that are financed through a combination of sponsor equity, tax equity, and back leverage debt.
Once a project becomes operational, it is required to repay these upfront costs through term loans and dividends to investors. During periods of low wholesale power prices on the grid, projects are at risk of not earning enough revenue to meet their debt service obligations or their investors’ rates of return. These conditions could lead to financial distress and potential default, said the report.
This issue is more pressing than ever, as over 100 GW of U.S. solar and wind projects may no longer pencil out due to the loss of federal tax credit support, according to a report by FTI Consulting. Developers are moving quickly to prioritize projects that do pencil out, said Trenton Allen, chief executive officer, Sustainable Capital Advisors in an interview with pv magazine USA.
The report from CEBA said offtake agreements like VPPAs significantly reduce the likelihood of projects entering these periods of financial distress by providing projects with a fixed price for the energy they produce.
Because of this, offtake agreements make it easier for projects to get financed and built, said the report. Debt interest rates and required debt service coverage ratios are typically lower for projects with corporate offtakers lined up.
“In this next year, as renewable energy projects aim to meet deadlines for tax credits, the support and cooperation of corporate buyers will give developers the confidence to advance spending to secure tax credits to reduce the cost of renewable energy,” said Joan Hutchinson, managing director of offtake advisory, Marathon Capital.
The report from CEBA also highlighted the financial stability that results from securing an offtaker for any Renewable Energy Certificates (RECs) associated with the developing project. Even with a relatively low REC value of $2.74, REC offtake agreements reduce the amount of projects that would face financial distress from 38% to 18% in ERCOT (a 52% reduction), and reductions of 23% and 17% in MISO and PJM, respectively.
Both VPPAs and RECs offer tools in the toolkit for renewable energy developers, said the report. While VPPAs reduce volatility by hedging against low wholesale power prices, unbundled REC purchases provide a consistent revenue boost to projects that may otherwise experience financial distress.
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