Alecta, one of the largest occupational pension providers in Europe, manages 2.5 million private customers and 35,000 corporate customers. Among its total investment portfolio, Alecta owns substantial real estate properties, including Sweden’s biggest retail parks, hotels, offices and more—all supplied by renewable energy sources since 2015. Alecta measures and reports the carbon footprint of its equity investments.
As Alecta planned to redevelop some retail properties in 2017, it surveyed commercial tenants and shoppers to understand how they could better address their needs. Sustainability turned out to be a high priority for their stakeholders.
Why a PPA with third-party investors proved irresistible for a global property owner
Alecta executives conducted significant research on how to reduce their properties’ carbon footprint, evaluating multiple solar industry firms. But most of them were EPC companies that would only help Alecta purchase and install solar cells. Alecta didn’t want to go that route.
“It makes more sense for us to be investing in the infrastructure investments on our properties instead of solar cells,” said Christofer Salmén, Asset Manager of Alecta’s retail portfolio. For Alecta, the idea of planning, buying and building the solar cells without renewable energy expertise was simply not practical.
Alight and its solar PPA model stood out from the competing solar industry firms. Its partnership with Infranode, a well-known energy infrastructure investor, provided additional credibility, according to Salmén.
“For us it’s highly important to do things right, especially with brands that we manage,” he said. “We want to minimize risks.”
1) Full-scale strategy and analysis of all Alecta facilities
Alight evaluated 12 of Alecta’s facilities within the first year and a half, determining the feasibility of rooftop solar cells. The analyses include cost comparisons of current electricity costs and PPA costs.
2) Solar energy rollout: retail parks, shopping malls, grocery stores, hotels
Initially, the partnership with Alight started with one solar project. Soon, solar projects multiplied into six within the first two years. One facility will produce 180 MWh per year. Two shopping centre facilities will generate 475 MWh per year.
3) Reduced CO2 by 103 tonnes within the first year and a half
After the first year and a half of partnering with Alight, Alecta had started six solar projects and reduced its CO2 by 103 tonnes.
4) Clear communications in local marketing and annual report
Communicating Alecta’s sustainability commitment and plans through the annual report has made a huge impact. “It shows that we’re taking action on sustainability and it’s a good way of marketing,” Salmén said. So far, Alecta’s communications strategy has focused on local marketing. However, the firm plans to explore more companywide marketing initiatives in the future.
5) Corporate culture transformed through renewable energy expertise
Salmén and his colleagues interact with Alight to discuss strategy every two or three weeks, while Alecta’s technical staff and building managers connect with Alight on a monthly basis. Of all the ways in which Alecta has benefitted from partnering with Alight, Salmén believes that the biggest impact among his colleagues has been the learning experience.
“I think the organization has learned about the benefits of renewable energy and they’ve learned how could you actually communicate this,” Salmén said. “The whole organization is very interested themselves.”
For Alecta, choosing the right solar energy firm was critical, given the sheer volume of properties they own and the many demands that will inevitably arise. They may want to rebuild certain properties, add more tenants or make infrastructure changes in the future. When those situations come up in the future, the Alight team will be there to work with them.