Verizon is a responsible, purpose-driven, trusted brand on the cutting edge of innovation to benefit our four key stakeholders: customers, shareholders, employees and society. We believe that we have a responsibility to leverage our technology, operations and employees to help move the world forward into a more connected, secure and sustainable future.
Key to this is our commitment to protect our planet for future generations. Verizon has set ambitious goals around climate protection, including achieving net-zero operational emissions by 2035.
As a first step on our net-zero journey, we have committed to source or generate renewable energy equivalent to 50% of our annual electricity consumption by 2025. Because most of Verizon’s emissions come from the electricity that we use to power our networks, our support of renewable energy and the transition to a greener grid is a key enabler to achieving this goal.
Our network operations are located across the country and require a constant supply of electricity to operate. It is not feasible to power our network operations directly from solar or wind generation facilities during every hour of every day, so we are dependent on sourcing power from our nation’s electrical grids. Today, much of that power is “brown” power, produced from conventional fossil fuels such as coal and oil. To achieve our renewable energy goals, we are focusing our resources on accelerating the transition to greener electrical grids across the U.S.
We are working to bring additional renewable energy to the grids by entering into long-term power purchase agreements for solar and wind power under development. The agreements, called virtual power purchase agreements, or VPPAs, are financially settled and can reduce Verizon’s long-term exposure to energy price volatility.
By providing the developers of renewable energy facilities with long-term revenue certainty, these agreements enable them to obtain the capital they need to construct the new solar and wind energy facilities. We generally do not expect to take physical delivery of the power from a facility under these agreements. Rather the facility operator sells the power into the wholesale market and we receive the renewable energy credits (RECs) associated with the power sold. We intend to retire these RECs against our actual energy consumption to track our progress in meeting our renewable energy goals.
Verizon is one of the leading corporate buyers of renewable energy in the U.S. Since December 2019, we have entered into 20 VPPAs for a total of nearly 2.6 gigawatts (GW) of anticipated renewable energy capacity. As of December 31, 2021, projects with 0.3 GW of renewable energy capacity have commenced commercial operation, and the remaining projects are expected to commence commercial operation over the next three years.
We believe that the VPPAs we’ve signed position us to achieve our renewable energy goal. Our VPPAs and the associated projects are expected to:
enable the avoidance of over 4.8 million metric tons of greenhouse gas emissions annually, equivalent to 1 million passenger vehicles driven annually (based on latest EPA eGRID United States Electricity Grid average); and
help 8 renewable energy developers build new wind and solar energy facilities in 11 states, bringing new jobs to the local communities and supporting the growth of the clean energy industry in the U.S.