Renewable energy claims by Amazon, Google, Meta and Microsoft challenged by state AGs chal
The anti-ESG crusade by Republican state attorneys general is spilling over into the tech industry, with Amazon, Google, Meta and Microsoft in the crosshairs. At issue: the way the four companies make claims about emissions reductions related to their electricity consumption.
The concerns of 16 states, led by Montana Attorney General Austin Knudsen, are described in a Sept. 24 letter sent to the chief legal officers of all four companies, citing consumer protection responsibilities related to electricity prices and grid reliability.
The 15-page, liberally footnoted missive contains 21 questions about the companies’ “use of environmental accounting gimmicks” to report progress toward 100 percent renewable energy targets. Responses to the questions are requested by Oct. 27.
The attorneys general are focused primarily on the companies’ use of “unbundled” renewable energy certificates (RECs), issued by a variety of generation sources. These are a type of environmental credit purchased solely for the purpose of making an emissions reduction claim; the organization using them doesn’t typically source electricity directly from the project nor did it help get the project onto the electric grid.
“Tech companies may argue that they have purchased the supposed right to claim the renewable attributes of the energy, but even if a contract purports to give them that right, the representations still mislead consumers,” the attorneys general wrote.
Grid reliability concerns cited
This behavior, along with “skyrocketing” demand from artificial intelligence data centers, contributes to grid instability because utilities are abandoning investments in important baseload power sources, the attorneys general allege in the letter.
“As a result of big tech’s misleading energy use claims, coal and natural gas plants are being shut down, putting communities across the country at an increased risk of blackouts over the next few years,” said Knudsen, in a press release announcing the investigation.
The other states signed onto the letter are Alabama, Alaska, Arkansas, Indiana, Iowa, Florida, Kansas, Missouri, Nebraska, North Dakota, Oklahoma, Pennsylvania, South Carolina, West Virginia and Wyoming.
All of these states, with the exception of Pennsylvania, have also demanded information from the Science Based Targets initiative, focused on gathering more details about financial institutions that have set net-zero targets.
Complicated picture
Amazon and Microsoft declined to comment on the letter. Google and Meta did not immediately respond to inquiries.
Current guidance from the Greenhouse Gas Protocol, which published carbon accounting rules used by 97 percent of companies making environmental claims, allows for companies to use unbundled RECs to make emissions claims for electricity, which falls under Scope 2. Revisions under consideration, and available shortly for public comment, are likely to be much stricter about how they can be used.
Amazon, Google, Meta and Microsoft all used unbundled RECs in the past to make Scope 2 claims. For the past five years, however, they have prioritized long-term power purchase agreements that facilitate the addition of more solar and wind power to the electric grid.
Those sorts of contracts are routinely used by large corporations to advance renewable electricity commitments: In 2024, corporate energy buyers added almost 22 gigawatts of clean energy to the U.S. grid, bringing the total since 2014 to 100 gigawatts.
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