CIBC banks on Canadian wind, hydro power

The Canadian Imperial Bank of Commerce (CIBC) is buying more renewable energy for its operations.

CIBC is buying a blend of wind and low-impact hydropower from a new project through an arrangement with developer Bullfrog Power. The purchase covers power use during the 2020 fiscal year for operations in New Brunswick, the Northwest Territories, Nova Scotia, Nunavut and Saskatchewan.

The generation, totaling more than 15,000MWh, will match the amount of conventional electricity used by CIBC in those provinces and territories, which generally have more carbon intensive generation mixes than elsewhere in Canada.

Nova Scotia, for example, used coal and coke for 63pc of its generation in 2018, according to federal energy data. In Saskatchewan, coal and natural gas combined for 84pc of generation in 2018, while they made up just 17pc of the national electricity mix.

The bank, one of Canada's five majors in the industry, is aiming to source 100pc of its electricity from renewables and become carbon neutral by 2024. CIBC also aims to cut its intensity-based emissions, measured in terms of kilograms of greenhouse gases emitted relative to floor space in their US and Canadian operations, by 20pc from 2018 to the end of 2026.

"By choosing green electricity, CIBC is supporting Canada's transition to a more sustainable future," CIBC executive vice president and chief legal officer Kikelomo Lawal said.

Neither the bank nor the developer immediately responded to an inquiry about how the renewable energy certificates (RECs) would be handled, but companies with sustainability goals typically retire the credits.

As there is no way to differentiate power from a coal plant and solar farm once it enters the grid, RECs are used to track each megawatt-hour of carbon-free generation from a renewable energy project. In order to claim the use of clean energy, electricity customers must retire the RECs, taking them out of circulation.

The credits are often sold separately from the associated power, allowing energy buyers with sustainability goals to purchase these unbundled RECs on the secondary market and retire them, thereby sourcing their consumption to renewables without changing how they acquire their actual electricity.

By Patrick Zemanek