Big Calif. renewables buyer bans forced labor in solar-plus-storage deals

Clean Power Alliance, California's largest local government-run community choice aggregator and one of the biggest buyers of renewable energy and battery storage output in the United States, has banned forced labor and child labor in three freshly approved long-term power purchase agreements.

The alliance's two new contracts with Clearway Energy Group LLC and a third new agreement with NextEra Energy Resources LLC for a combined 206.5 MW of solar photovoltaic power and 163 MW/652 MWh of battery storage capacity include an expanded supply chain code that forbids any forced labor, child labor, slavery and other human rights abuses from being associated with the projects, including through the mining, processing and procurement of materials used in the production of solar panels.

The move mirrors increasing U.S. federal government and power-sector sensitivity to possible human rights abuses linked to imports, partially aimed at solar panel suppliers' reliance on polysilicon feedstock from China's autonomous Xinjiang region. The Clean Power Alliance disclosed the power purchase agreements, and its reasoning for intensified supply chain restrictions, during a June 3 board meeting.

"Recently, the Chinese government began detaining Uyghur Muslims and other minorities in internment camps and subjecting some of them to forced labor, including in the manufacturing of polysilicon, a key material in photovoltaic modules used for solar generation," the alliance said in its meeting agenda.

While China has denied allegations of human rights abuses in Xinjiang, American lawmakers are considering prohibiting imports from the region, which produces a large share of the polysilicon used in conventional crystalline solar panels around the world. As the U.S. government considers its next steps, "[The Clean Power Alliance] felt it was necessary to add additional provisions to its renewable power purchase agreements to protect the human rights of workers," an alliance spokesperson said in an emailed statement.

Seeking transparency

In the wake of mounting assertions of human rights abuses in Xinjiang, Clearway, owned by Global Infrastructure Management Participation LLC, recently joined more than 200 companies that finance and supply solar power plants and components in signing a pledge to cleanse their supply chains of any forced labor. The effort includes the creation of a "supply chain traceability protocol" to identify the sources of primary raw materials.

NextEra Energy Resources, the competitive generation arm of NextEra Energy Inc. and one of the world's largest purchasers of solar panels, had not signed the pledge as of May 19, according to a document from the Solar Energy Industries Association, the top U.S. solar trade group, which is spearheading the industrywide initiative.

The company did not immediately respond to a request on why it had not signed the pledge.

However, NextEra in its May 2021 report on environmental, social and governance issues said it holds its suppliers to the same standards that it holds for itself, including a stated commitment to human rights.

There are also concerns around human rights and environmental abuses related to cobalt, lithium and other materials used to make lithium-ion batteries, which will be used in the Clean Power Alliance projects. Clearway is among a collection of utilities, battery storage suppliers and project developers that have signed a "corporate responsibility pledge" to address supply chain risks and other hazards associated with fast-multiplying energy storage installations.

Moving toward a deadline

Clean Power Alliance's contractual requirements build on such initiatives and come as it ramps up its purchases of renewable energy generation and battery storage along with other aggregators around the state seeking to completely decarbonize their power mixes faster than California's 2045 target. The alliance was established in 2017 as a buyer of power for now more than 3 million residents within the service territory of Edison International subsidiary Southern California Edison Co., It has already approved agreements for power from new renewable resources that in total supply more than one-third of its needs.

The new contracts, awarded from a pool of more than 100 proposals, include a 15-year power purchase agreement with Clearway for 93.5 MW of solar and 71 MW of four-hour energy storage from the Arica solar-plus-storage facility in Riverside County, Calif., starting in December 2023. The alliance also contracted for 65 MW of solar and 52 MW of four-hour battery storage at Clearway's planned 650-MW Daggett Solar Project in San Bernardino County, Calif., beginning in September 2023.

Previously, the alliance's board approved a separate contract for 123 MW of solar and 61.5 MW of storage from Daggett.

The aggregator also approved a 20-year contract combining 48 MW of solar and 40 MW/160 MWh of energy storage from NextEra's Resurgence Solar II project, located in San Bernardino County, Calif.

A fourth new contract, with Calpine Corp., calls for 438,000 MWh in annual deliveries from a 50-MW block of the Geysers geothermal energy complex in Sonoma County, Calif. The supply chain provisions do not apply to this project, the alliance said.