As the Solarplaza Summit PPAs The Netherlands is drawing near, we checked in with one of the speakers to get a preview and some insights into the corporate offtaker’s perspective. Zishanul Hasan is an energy buyer and CO2 reduction leader at Decathlon, the French sporting goods retailer that boasts impressive stats of operating stores worldwide in nearly 1,000 cities and 65 countries. The way such a multinational sources its energy has a massive global impact, therefore we were very keen on learning more about the company’s strategy and experience.
In 2020, news broke that Decathlon would partner up with Voltalia to renewable source 15% of the company’s energy consumption in France through solar power. The project entered into operations just this year, meaning their 16 MW PPA also came into effect, accounting for approximately 26 GWh of annual production (Voltalia, 2023).
Over the last 12 years, Zishanul Hasan has been associated with the retail industry, focusing on sustainability, production, supply chains, purchasing, innovating, pushing boundaries, and delivering decisive competitive advantages to businesses. As a part of his journey, he has managed multi-cultural teams and multi-million € P&Ls, applying his broad knowledge of retail value chains, from sourcing to sales.
Zishanul, what are the key learnings you took away from the recent PPA you signed and what is the main advice you would give other (off-taker) companies who are currently looking into signing a PPA?
It was the first pilot we did and for a very small volume when compared to our overall needs, of course. We are constantly working in different markets to see what the best possible solutions are. Those can be totally market-dependent, as some countries have very open policies compared to others. Speaking about that specific PPA we signed for 16 MW: it was quite a long process, especially in the case when you are working on additionality, which creates a risk for the developer (and eventually the off-taker) as the material and overall price may change a lot compared to the initial contract signed. The risks and gains go hand in hand.
What is the strategy to move towards your company’s renewable energy goals and how do you aim to tackle them?
The Decathlon decarbonization project has three parts, starting from ‘Measure’, advancing to ‘Set the Targets’, and becoming effective with ‘Reduce’. Renewable energy is one of the actions in this ‘Reduce’ phase.
We have launched the DREPP initiative (Decathlon Renewable Energy Program for Production) for all our scope 3 emissions [red: check out this useful link to learn more about the definition of these scopes]. Under the program, we assist all our suppliers with the procurement of renewable energy: on-site, off-site, and EACs [red: Expected Annual Consumption]. Apart from procurement, we also partnered with developers in the countries with major production facilities to assist with the deployment of on-site solar.
Under the program, we clearly focus on additionality and then bundled renewable energy. And if these are not sufficient we help suppliers with EAC procurement.
What difficulties did you face when aiming to source energy through renewables via PPAs?
For us, the main CO2 component in our whole value chain is not Scope 1 or 2 but mainly scope 3 activity. That relates mostly to our suppliers, linked to our production activities in different sites, worldwide. The list of difficulties is quite long when we speak about renewable energy in production.
Firstly, production activity is mostly situated in Asia, where the policies on renewable energy are quite stringent in most countries. There is some development, but it’s still not easy for procurement, especially related to offsite renewables projects.
Secondly, if we want to make a cohort and do group purchases, the most critical part is to have a consensus on renewable energy procurement at the same time and at the same speed between different parties.
The last thing I can list here, which remains a top challenge, is the general lack of awareness of renewables, and the benefits they can bring to the planet and financially to consumers. Education on this topic remains the top priority in the whole project management effort.
A big question perhaps, but what is your general outlook and view on the future of renewable energy?
With the current energy crisis, we already see the market - especially the EU - moving from a buyer market to a developer market, which directly reflects that the demand increase is much higher than the available supply of renewable energy. At the same time, we saw the price of MWhs also increasing due to many reasons, but the market seems to accentuate the demand side more than the supply. That clearly shows the acceleration of renewable energy in EU. Outside of the EU, we clearly see the policies getting relaxed and easier in many Asian countries like Vietnam, China, India, and more.
Why are you participating in the Solarplaza Summit PPAs and what are your expectations?
The main objective is to have an exchange and expand our network, especially with solution providers (developers/consultants) in the market, while at the same time addressing the difficulties we face from the perspective and expertise of a buyer.