Bringing New Solar Plants to Life in Michigan

Braze is thrilled to announce our first Virtual Power Purchase Agreement (VPPA), a long-term financial contract between a buyer and a clean energy project. Through our commitment, we are helping fund the build of five solar facilities in Michigan, built by the developer Irradiant Partners. As part of this agreement, Braze has committed upfront to buying Energy Attribute Certificates (EACs) generated by these facilities over the next five years, which is the equivalent of 1,600 MWh of clean power per year. In addition, this upfront commitment helps the developer secure capital to build these facilities.

Guiding principles for our Social Impact work include focusing on actions that are material and scalable. We ground our sustainability programs in climate science. We measure our scope 1, 2 and 3 greenhouse gas emissions annually and are actively working to reduce our environmental footprint. This VPPA investment is an important step in our climate journey.

What is the impact?

Our multi-year commitment will avoid an estimated 3,800 mtCO2e (metric tons of carbon dioxide equivalent), equivalent to more than nine million car miles driven. The EACs generated from the VPPA investment will also support reductions of our scope 2 greenhouse gas emissions.

The solar plants will bring new clean energy on the grid, help support Michigan’s 4,000+ solar jobs, and benefit communities beyond Braze. We are particularly excited to see the impact that this project will have, given that Michigan’s electricity generation is ~1% solar, meaning that adding clean power can have an important decarbonization impact by displacing generation from an otherwise fossil-heavy grid. Globally, this type of investment is also crucial because estimates are that global renewable capacity must triple to meet the 1.5C Paris-aligned goals.

VPPA’s are usually reserved for larger companies, but through Watershed we’re able to combine our purchasing power with Block, DoorDash, Match Group, and Unity, and we are excited to help lead the way.

VPPA 101

A VPPA is a financial agreement between a purchaser and a renewable energy project. Traditionally, VPPAs require purchasers to make a bet on electricity prices by covering the difference between the price at which the project’s electricity is sold and a predetermined strike price. Under Braze’s simplified, ‘fixed price’ VPPA arrangement, Braze is committing to pay a fixed price for the EACs produced by the project for a certain duration of years without making a bet on electricity prices.

Knowing that there are guaranteed EAC buyers at a certain price in advance is critical for the developer of the project to obtain the financing required to construct the new clean energy initiative. Furthermore, the purchaser can credit the EACs generated towards greenhouse gas emissions reduction goals. Notably, the purchaser does not directly utilize the electricity produced; rather, they continue using their existing local power supply while paying the agreed EAC price to the developer.

Key climate benefits of a VPPA:

• Additionality: This project has high additionality, meaning that if Braze and our partners did not make this upfront commitment, the solar plants would likely not have been built. This creates a stronger market signal than buying EACs from existing projects that would continue producing electricity whether or not the EACs were purchased. Compared to supporting existing renewable generation, a VPPA supports directly adding new renewable energy to the grid.
• Emissionality: Emissionality relates to the estimated avoided emissions and creates infrastructure where it will drive the most emissions reductions. In this case, Michigan is a fossil-heavy grid. For example, building these solar plants in Michigan instead of states that have higher levels of renewable sources on their grids, should make a bigger dent in avoiding greenhouse gas emissions.

Final Thought

Our first Virtual Power Purchase Agreement (VPPA) signifies a meaningful stride in our commitment to sustainability. By helping fund the construction of five solar plants in Michigan, we aim to reduce our greenhouse gas emissions and foster local economic development.

Want to learn more about our commitment to advancing our environmental, social, and governance (ESG) initiatives. Check out our latest ESG report.