Rivian CEO RJ Scaringe is calling out companies that engage in greenwashing, or exaggerating their environmental credentials. He believes that companies often obscure the source of their power consumption, particularly when they don’t actually contribute to the creation of new renewable energy capacity. Scaringe argues that consumers often struggle to differentiate between companies that genuinely support renewable energy and those that simply want to appear environmentally friendly.
Rivian, on the other hand, falls into the category of companies that not only aim to eliminate their own carbon emissions but also strive to help create new capacity for renewable energy. As part of this commitment, Scaringe announced Rivian’s support for a new solar energy center in Kentucky. The Starfire mine, a former coal mine, will be transformed into a solar farm capable of generating 800 megawatts (MW) of energy, enough to power 160,000 homes annually. BrightNight, a solar company based in Florida, is also building a 10-mile transmission line that will enable an additional one gigawatt of power capacity in the future.
Although Rivian is not directly funding the project, it has committed to purchasing 100MW of energy as part of a virtual power purchase agreement (PPA). This agreement means that the clean energy won’t flow directly into Rivian’s electric vehicles or its corporate offices and factories. However, the energy will be used to power up to 450 million miles of renewable driving each year. Virtual PPAs have become increasingly popular among American companies, with corporations purchasing a record 31.1GW of clean energy in 2021 alone.
Scaringe highlights the importance of virtual PPAs in the success of renewable energy projects. Without commitments from companies to purchase the power generated, many of these projects would not be financially viable. Rivian is not the only automaker to make such a commitment; other companies like Stellantis and Mercedes-Benz have also signed virtual PPAs to support clean energy initiatives.
Rivian has been actively involved in discussions around electric vehicles and climate change. The company has criticized its competitors for not doing enough to reduce greenhouse gas emissions in line with the targets set by the Paris Agreement. In a report co-authored with Polestar, Rivian argued that relying solely on EVs would not be sufficient to limit global temperature increases. Instead, the entire auto industry needs to participate in increasing renewable energy in power grids and reducing emissions across the supply chain.
However, Rivian still has room for improvement. The company does not disclose its emissions data to CDP, a nonprofit organization that evaluates companies’ environmental reporting. Rivian aims to achieve “Scope 3 neutrality,” meaning it wants to eliminate all indirect emissions from its supply chain and the lifecycle of its electric vehicles. The company is addressing its Scope 1 emissions, which come from its factory and corporate offices, by installing a wind turbine at its plant in Illinois. Scope 2 emissions, from electricity use, will be addressed through the creation of an upstream supply to offset emissions from Rivian’s suppliers.
The majority of Rivian’s emissions, around 90%, are Scope 3 emissions generated by its fleet of electric vehicles. To offset these emissions, Rivian has agreed to purchase 100MW of energy from the solar farm in Kentucky, among other virtual PPAs. This energy will be used to power the growing fleet of Rivian vehicles, as well as future customers. Scaringe predicts that in a few years, Rivians on the road will consume more energy than the entire country of Ireland.
In conclusion, Rivian CEO RJ Scaringe is advocating for companies to go beyond greenwashing and actively contribute to the creation of new renewable energy capacity. Rivian’s support for a solar energy center in Kentucky and its commitment to purchasing clean energy through virtual PPAs demonstrates its dedication to sustainability both in its operations and its products. However, there is still work to be done in terms of transparency and reducing emissions across Rivian’s supply chain.
