Iceland Foods inks PPA to offtake electricity from new British solar farm
Supermarket Iceland Foods has signed a ten-year power purchase agreement (PPA) with Octopus Energy, that will see it directly procuring renewable electricity from a solar farm in Cambridgeshire.
Under the PPA, Iceland will procure around 64 GWh of renewable electricity every year from the Breach solar farm in Cambridgeshire. This will cover around 14% of the retailer’s annual electricity needs for its stores across the UK.
The 67MW Breach solar farm is due to come online at the end of this year. Octopus Energy’s Generation business acquired the project last June and construction subsequently began in November.
Iceland has been purchasing 100% renewable energy for its operations since 2019. However, like many other businesses, it has stated an intention to go beyond simply choosing renewable tariffs and opting for measures that definitely result in additional renewable electricity generation capacity coming online, like PPAs.
Another benefit of PPAs, Iceland’s chief executive Tarsem Dhaliwal said, is having “clarity on energy costs for the coming years – at a significant discount to the current wholesale”.
“Switching to more renewable forms of energy to power our sites will be a huge priority for us in the coming years, as we continue to identify solutions to optimise sustainability across the business,” Dhaliwal added, noting Iceland’s commitment to becoming a net-zero business by 2040.
The commitment was made in 2020 and covers Iceland’s operations and supply chains. It is underpinned by a commitment to halve absolute emissions across all scopes by 2030, plus specific emissions goals for fuel, gas and refrigerant use earlier than 2040. Iceland is notably a member of the Climate Pledge, which is co-orchestrated by Amazon and brings together dozens of businesses working towards net-zero by 2040 at the latest.
The news from Iceland comes shortly after Vodafone signed its second solar PPA in the UK. The telecoms giant is working with Centrica and MYTILINEOS to procure electricity a total of 10 renewable energy projects in the UK – two onshore wind farms and eight solar farms.
Another business to have posted progress with UK-based solar PPAs this year is H&M Group. It recently confirmed the completion of two new solar projects in Leicestershire, through which it will source renewable electricity via a PPA with Lightsource bp and Schroders Greencoat.
According to LevelTen Energy, the vast majority of the corporate PPAs completed in Europe last year were solar. This was despite an uptick in PPA prices amid the energy price crisis and supply chain disruption.
It revealed an 11.4% quarter-on-quarter increase in solar PPA prices across all markets, or a 60% increase year-on-year. The quarter-on-quarter increase was steepest in the UK, at 30%. Italy also saw a significant increase of 20%.