CLIENT LOGIN
Contact Us

Find Us

5 Headerquarters

4545 Fuller Dr. Suite 412
Irving, TX 75038
Phone: (972) 445-9584
Toll Free: (855) 275-3483
Fax: (855) 329-3493
email5@energyby5.com

5- Northeast

865 State Route 33
Ste 3 PMB 1077
Freehold, NJ 07728
Phone: (732) 774-0005
Fax: (855) 329-3483
email5@energyby5.com

5- Mexico

CP 11000, Miguel Hidalgo
CDMX, Mexico
Phone: +5595287982
mexico@energyby5.com

SUSTAINABILITY

OVERVIEW
Renewable
Energy Credits
Renewable
Retail Contracts
PPAs/VPPAs
SOLAR SUPPORT

SUSTAINABILITY
OVERVIEW

Sustainability is about meeting the needs of the present while preserving resources for future generations. The concept of sustainability is composed of three main pillars - economic, environmental, and social. Energy sustainability crosses into each of these three pillars and encompasses every part of the energy value chain.

Through 5’s comprehensive approach to energy management, clients receive the necessary tools and knowledge to achieve and report on their own sustainability goals, including:
• Resiliency planning – Addressing client-specific needs through microgrids, distributed generation, peak load management, demand response, power quality reviews, combined heat and power, batteries and fuel cells.

• Generation sourcing – Deciding between traditional sources of grid power versus on-site and utility-scale options for solar power, wind power, and a host of emerging alternative fuels.

• Decarbonization – Sequestering carbon emissions and through carbon offsets.

• Renewable energy purchasing – Renewable Energy Credits (RECs), PPAs and VPPAs, or Renewable Retail Contracts.

• Energy efficiency – Investing in clean-energy technologies, systems, and controls to reduce power consumption.

• Reporting assistance – EnergyStar, LEED, Well Building, ASHRAE audits, EPA Green Power Partnership.

sustainability-image1
“The Empire State Building has always served as a symbol of what is possible, and in the past decade that has extended to include leadership in healthy, sustainable buildings. To ensure that the ‘World’s Most Famous Building’ advances its clean-energy strategies and decarbonization leadership, we trust the advisory team at 5 and their comprehensive approach to the energy value chain, which includes procurement, local law compliance, financial modeling analysis, grid modeling, and renewable expertise.”
– Dana Robbins Schneider, Senior Vice President,
Director of Energy, Sustainability & ESG,
Empire State Realty Trust

RENEWABLE ENERGY
CREDITS

Renewable Energy Credits (RECs) are financial instruments used to offset the indirect greenhouse gas emissions of an organization while funding the development and operation of renewable energy resources. The story of RECs in the US begins in Texas, the first state to implement a Renewable Portfolio Standard (RPS) back in 1999. Texas law required that a certain amount of the electricity consumed within the state come from a renewable energy source at a future date, driving the local utility companies to purchase RECs from renewable power plants to comply. Since then, dozens of US states and many countries around the world have established their own RPS and purchase RECs to comply with those standards.

Soon a voluntary market emerged for purchasing RECs in the context of corporate sustainability. Today, the demand for RECs is as high as the number of companies establishing their own internal targets for renewable energy continues to increase. RECs are a simple and cost-effective way for most companies to meet their sustainability goals. RECs also provide transparency and credibility to a company’s environmental claims as certifying agencies, such as Green-e, track the ownership trail and eventual retirement of each REC.

The US has multiple, independent electricity grids that are interconnected to some degree. This allows RECs to be sourced from one part of the country and applied and claimed against electricity consumed anywhere else in the country. There is also an established, over-the-counter market for RECs where banks, brokers, traders, and end-users such as utilities and competitive suppliers, transact with one another.

The team at 5 works closely with clients to determine the most important factors for any environmental sustainability effort including the geographic location of the facilities, the size of the annual electricity requirements, and the specific sustainability targets established by the client. For most clients, REC purchases are the starting point on their path toward more sustainable operations. RECs have a long track record of decarbonizing electricity generation through a market mechanism for energy buyers to make environmental claims that support renewable power projects.

RECs are also growing and rapidly changing. New attributes are being assigned to RECs at the request of large corporate buyers, like those in the RE100 (a global group of businesses committed to 100% renewable electricity). There are also emerging markets for other types of environmental commodities beyond RECs, such as Carbon Offset Credits, which generate their own set of unique environmental claims related to “net zero emissions”.

RECs are an exciting and evolving aspect of the energy industry that 5 is well-equipped to navigate for clients.

sustainability-image2
“The speed at which 5 was able to provide feedback I’ve found to be a good marker of a real quality partner.”
- Brian Webb, Sustainability Director, Houghton College

RENEWABLE RETAIL
CONTRACTS

Renewable power plant developers and suppliers alike acknowledge the client issues that are inherent in Virtual Power Purchase Agreements (VPPAs). These issues include their legal complexity, difficulties associated with derivative accounting requirements, market risks, and the fact that most do not completely understand, nor can they adequately quantify, the significant risks included in a VPPA. Almost 20 years into energy deregulation, a more client-friendly renewable product has finally become available in the market, the Renewable Retail Contract or RRC.

The RRC is designed to look and feel like a typical commercial electricity contract for the client while the behind-the-scenes structure shifts most of the risks of a VPPA to the supplier. RRCs are generally longer in term than standard retail contracts and have renewable attributes and benefits beyond simple REC purchases. Thanks to RRCs, clients can point to specific renewable energy generation assets as part of their retail power agreement while still completing a simple, straightforward procurement process.

5 helps many medium and large clients to secure long-term RRCs, many at rates that are the same or better than the standard supplier offers without the green attributes. Gone are the days when only large, sophisticated users could qualify for the programs and products necessary to meet their aggressive decarbonization goals.

sustainability-image3
“Working with 5 has enabled us to not only save a significant amount of money but our partnership has moved us forward in responding to the Pope’s call to be better stewards of the environment and take action against the degradation of the environment and climate change.”
- Cynthia Herndon, Director of Purchasing,
Catholic Diocese of Dallas

PPA/VPPA

Power Purchase Agreements (PPAs) and Virtual Power Purchase Agreements (VPPAs) have become an important way in which businesses advance their sustainability goals. A PPA is an agreement between a buyer and seller, typically for behind-the-meter, physically delivered electricity at a specified price over the term of the contract. PPAs are often long-term contracts between a renewable power developer and a client that agrees to receive the output of that renewable power asset, such as a solar array. VPPAs are a specific type of PPA where the purchaser does not physically receive the output of a given renewable asset. These transactions are financial instruments that are commonly structured as a contract for differences, also known as a swap, and they are classified as financial derivatives under the US generally accepted accounting principles (GAAP).

PPAs and VPPAs are complex agreements with language and terms that are not familiar to most commercial and industrial clients and their legal teams. 5 has written, reviewed, and negotiated numerous PPAs and VPPAs for clients across North America. The long-term nature of these contracts (often 10 to 20 years) requires an exacting review of the terms and conditions and a thorough understanding of how the client will be bound to the PPA/VPPA seller.

Many businesses have turned to 5 to incorporate PPAs and VPPAs into their sustainability plans. These clients have benefited from 5’s extensive experience in developing and negotiating these complicated contracts while taking steps to reduce their carbon footprint.

sustainability-image4
“We’ve put our trust in 5 to help us develop and execute our energy sourcing strategy. We believe 5’s experience with both complex wholesale transactions and the deregulation of new energy markets in the US and overseas will help us to successfully navigate the opportunities generated by the energy reform.”
- Enrique Güijosa, CFO, Liverpool

SOLAR SUPPORT

ONSITE SOLAR PROJECTS

Solar power sales reps have been knocking on doors and cold-calling businesses to spread the good news about the free power waiting on everybody’s rooftops. The sales pitch is so basic and appealing, harvest the sun’s energy, and save money. It all seems like a no-brainer. Unfortunately, solar power options for commercial clients are not that simple and a bad decision can be costly for many years to come.

The ability for businesses to install and benefit from a rooftop solar array varies greatly from one utility to the next. There are specific constructs within each utility’s tariffs and infrastructure that may cause on-site solar options to be more or less attractive. In addition, retail electricity suppliers often have clauses in their agreements that penalize on-site solar users because the on-site source of power reduces the supplier’s ability to deliver the contracted quantity of energy. Retail energy products need to be structured with potential on-site solar needs in mind, while also accounting for the net-metering necessary to allow the client to benefit from any excess power produced by the solar array. Clients must also decide if they will finance or purchase their new solar panels and need to consider ongoing maintenance and service costs as well. Purchase Power Agreements (PPAs) are also a major consideration when evaluating the cost/benefit of a client-owned solar asset.

5 takes the time to understand the opportunities and constraints for each client as they consider potential solar power options and then builds the financial modeling necessary to guide their decisions. This process considers federal and regional incentives, upfront and ongoing costs, current and future energy market conditions, and the client’s sustainability goals. Some clients elect to add on-site solar (rooftop, parking awnings, stand-alone units) while others decide to participate in community solar programs or purchase Renewable Energy Credits, Virtual Purchase Power Agreements (VPPAs), or Renewable Retail Contracts to meet their company’s decarbonization goals. 5 assists the client during every step of the process and holds solar developers and their sales reps accountable for the critical details of each offer. 
 
COMMUNITY SOLAR PROJECTS

A community solar project is one where the benefits of an off-site solar array are shared among multiple parties. Community solar programs are enabled by state legislation and promote renewable energy development by providing financial savings to customers for subscribing to off-site solar projects. Community solar customers benefit from utility bill savings, but do not receive the electricity generated from the array or the renewable attributes (RECs). Community solar is a good option for credit-worthy institutions to save money on utility bills without any upfront cost or on-site development risk.

iStock-1623080728
“When selecting an energy advisory firm, we could not find a group more qualified than 5. Jon Moore and his team take a holistic approach to energy management and helped us to create a strategy that included procurement, risk management, and a large solar PV system in a customized approach for our club.”
- Stephen Smith, General Manager, Kenwood Country Club