Rivian CEO: “There’s Too Much Greenwashing in the System”

Rivian CEO RJ Scaringe is fed up with companies exaggerating their environmental credentials.

“There is too much greenwashing in the system,” he said in a recent interview. For Scaringe, it’s all too easy for a company to obscure the source of its electricity consumption, especially when it doesn’t actually build any new capacity for renewable energy. And consumers aren’t smart enough to tell the difference.

“It’s conceptually very complex,” he said, making a clear distinction between companies that buy renewable energy to cover their own emissions as well as create new capacity and those that “are willing to pay a little incremental amount more to get capacity to pat themselves on the back and say we’re using renewable energy.”

Scaringe places Rivian firmly among the ranks of companies that seek to not only offset their own carbon emissions but also help create new capacity to manufacture renewable energy. To that end, he is in Kentucky on Tuesday to announce Rivian’s endorsement of a new solar power center to be built on top of a former coal mine.

Located on top of a hill in eastern Kentucky, the Starfire Mine once housed hundreds of miners hauling millions of tons of coal each year. But soon, it will be the site of a massive solar farm with the goal of creating 800 megawatts (MW) of energy – enough to power 160,000 homes each year. BrightKnight, a Florida-based solar company, is also building a 10-mile transmission line to enable an additional one gigawatt of electricity capacity for the future.

Rivian will be the offtaker for the project, or buyer of electricity generated from the site. The EV company is not directly funding the project, which is estimated to cost $1 billion, but it has committed to purchasing 100 megawatts of energy as part of a virtual power purchase agreement (PPA) — virtual because the clean energy won’t flow directly to Rivian’s electric trucks, SUVs, or vans, or even to the company’s corporate offices or factories. Still, Rivian says the energy will “help power up to 450 million miles of renewable driving each year.”

Virtual PPAs are becoming an increasingly popular form of clean energy commitment for US companies. For example, in 2021, corporations will buy a record 31.1GW of clean energy, equivalent to more than 10 percent of all new renewable energy capacity added worldwide. that year. More than half of the deals were with tech giants including Amazon, Microsoft, Meta and Google.

According to Scaringe, without these PPAs, many of these renewable energy projects would not get off the ground. Rivian is not directly funding the solar project, but is ensuring that there will be a market for the energy when the photovoltaic cells come online. “If the companies are not making the commitment to buy the power that makes the project funded, these projects will not happen,” he said.

Rivian isn’t the first automaker to commit to buying clean energy through a virtual PPA. Stellantis signs 400MW agreement with DTE Energy in Michigan late last year, while Mercedes-Benz said it would buy 140 megawatts from an offshore wind farm in the Baltic Sea.

Virtual PPAs are “easily scalable and enable buyers to meet a large portion of their sustainability goals with a relatively small number of transactions,” said the Rocky Mountain Institute. wrote in a 2019 report,

Rivian has been at the forefront of the debate on electric vehicles and climate change, and has criticized its competitors, saying they are a “far way off” in terms of reducing greenhouse gas emissions that could meet targets set by the Paris Agreement. The company co-authored a report earlier this year with Polestar, which argued that EVs alone would not be enough to limit global temperature rise. The auto industry will need to play a stronger role in driving renewable energy into the power grid and reducing greenhouse gas emissions throughout its supply chain.

But the company still needs to move forward. Rivian doesn’t share its emissions data with CDP, a nonprofit that evaluates companies’ environmental reporting. For example, FordAgrade for its climate change disclosures since 2019, while Tesla earnedFGrade. Environmental advocates are becoming increasingly vocal in demanding more transparency from corporations about the full picture of their carbon emissions.

Scaringe said Rivian is working toward “Scope 3 neutrality,” meaning it aims to eliminate all indirect emissions from its supply chain and the lifecycle of the EVs it produces. A common criticism of EVs is that they are only as clean as their power source – in other words, if an EV is charging from a grid that derives its power primarily from a polluting source such as coal, it cannot claim to be a truly clean mode of transport.

Rivian is targeting its Scope 1 emissions from its factory and corporate offices by installing a wind turbine at its plant in Normal, Illinois. Scarring said Scope 2 emissions from electricity use would have to be controlled “through the creation of an upstream supply that would help offset the emissions created by Rivian’s suppliers”.

But “90 percent” of Rivian’s emissions are the Scope 3 — its fleet of electric R1T trucks, R1S SUVs and EDV delivery vans. And those emissions are the reason the company is agreeing to buy 100 MW of power from a solar farm in Kentucky, in addition to other PPAs. A virtual power agreement for the Company’s current and future customers, which Scaringe anticipates will continue to grow as the Company’s generation capabilities mature.

“We create a supply that balances our collective fleet usage and as the fleet grows, it becomes a major consumer of energy,” he said. “A few years from now, the carpark at Riviens will be consuming more energy than the entire country of Ireland.”