The role of long-term purchasing in renewable energy deployment

The role of long-term purchasing in renewable energy deployment | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Article The role of long-term purchasing in renewable energy deployment Philipp Beiter, Sushmita Jena, Jenny Sumner This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-8088160/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted You are reading this latest preprint version Abstract The availability of investment capital for new renewable energy assets is a key challenge for power system evolution. However, the enabling conditions for renewables investments are often overlooked, which could lead to an overestimation of renewables’ deployment potential. Securing financing for renewables depends on stable and predictable revenue. Long-term contracts provide such revenue and thereby enable their deployment. The entities that are equipped to offer long-term contracts are limited to utilities, independent power producers, and large corporations. Here, we explore the extent to which renewables deployment may be constrained by limited demand from energy offtakers. We identify high creditworthiness, demand volume and energy use predictability as common features among offtakers that enable their long-term price commitments in offtake contracts. To assess the potential purchasing demand for renewables in the United States, we combine utility renewable portfolio mandates and climate pledges with electricity consumption estimates from major corporations through 2035. Our findings suggest that the purchasing demand from utility and corporate offtakers could constrain renewables deployment under many scenarios. We further explain that even when renewables are at cost parity with fossil-fueled assets, their relatively high up-front capital expenditure means that long-term offtake agreements are usually needed for their deployment. Such understanding has important implications for policy and power systems planning, which may often overstate renewables demand and omit the critical role of offtakers for renewables deployment. Scientific community and society/Energy and society/Energy supply and demand Scientific community and society/Energy and society/Energy economics Scientific community and society/Energy and society/Energy policy Energy demand supply-demand mismatch utilities voluntary markets renewable portfolio standards corporate power purchase agreement long-term contracts procurement wind energy solar photovoltaics Full Text Additional Declarations There is NO Competing Interest. Cite Share Download PDF Status: Under Review Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. 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Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-8088160","acceptedTermsAndConditions":true,"allowDirectSubmit":false,"archivedVersions":[],"articleType":"Article","associatedPublications":[],"authors":[{"id":550779916,"identity":"c2b54483-36df-4ca9-ab2c-6135766dc6b8","order_by":0,"name":"Philipp 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