Amazon (NASDAQ: AMZN) has announced a major renewable energy deal in the United States, partnering with Avangrid on a $100 million solar project. The development will add clean electricity to the U.S. grid and further support Amazon’s climate goals.
The agreement highlights the growing role of large corporations in driving clean energy demand. Amazon is one of the biggest buyers of renewable energy in the world. It is quickly growing its solar and wind portfolio.
Amazon signs long-term power purchase agreements (PPAs) to secure renewable electricity. This also helps developers like Avangrid get the funds they need to build large projects.
Net-Zero by 2040: Amazon’s Big Climate Goals, and Bigger Challenges
Amazon aims to reach net-zero carbon emissions by 2040. It also plans to run all operations on 100% renewable energy by 2025, a target it says it is close to achieving.
But Amazon’s emissions profile shows how hard this goal is. In 2024, the company’s total greenhouse gas emissions rose by 6%, reaching 68.25 million metric tons of CO₂ equivalent. That marked a reversal after years of reductions. All scopes saw increases.
Here is how the emissions break down: Despite the growth in absolute emissions, Amazon says it improved its carbon intensity (emissions per unit of business) by 4% in 2024.
Amazon explains its carbon footprint calculation using the GHG Protocol. It includes direct operations, energy use, and activities in the value chain. This covers product manufacturing, logistics, packaging, and more.
To reduce its impact, Amazon has taken multiple steps:
- Matching electricity use with renewable energy: In 2024, Amazon used 100% renewable energy for all its data centers and facilities.
- Investing in renewable capacity: As of early 2025, Amazon had invested in 621 renewable projects, amounting to 34 GW of carbon-free energy capacity.
- Storage and grid support: Amazon pairs solar projects with battery energy storage systems, enabling more stable renewable energy integration.
- Efficiency in data centers: Amazon’s AWS data centers reported a Power Usage Effectiveness (PUE) of 1.15, better than many industry averages.
- Innovation in cooling and design: New data center components launched in 2024 provided 12% more compute power. They also reduced peak cooling energy use by 46% without increasing water usage.
These actions show the e-commerce giant is not just buying clean power, but trying to redesign how it uses energy.
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Avangrid’s Solar Play and Why It Matters
Avangrid, part of the Iberdrola Group, is one of the largest renewable energy companies in the United States. Its $100 million investment in the new solar project underlines the scale of capital required to expand America’s clean power supply.
The company currently operates more than 8.6 gigawatts (GW) of renewable capacity in the U.S., including wind and solar. By partnering with Amazon, Avangrid gets a steady buyer for its electricity. This deal also speeds up the growth of renewable infrastructure. This helps meet both state and national clean energy goals.
This project also illustrates how large tech and energy firms can work together. Amazon’s demand provides a stable revenue stream, and Avangrid gains the capital certainty to build more solar capacity. Over time, similar deals can help accelerate the transition of the U.S. power grid to cleaner sources.
Scaling renewable energy helps Amazon in two ways:
- It reduces operational emissions (Scope 2) in regions where Amazon operates.
- It supports grid decarbonization, which benefits all electricity users—including Amazon’s neighbors and future expansions.
How Corporate Demand Supercharges Renewable Growth
The deal comes at a time when renewable energy investment in the U.S. is accelerating. The International Energy Agency (IEA) reports that global clean energy investment hit $3.3 trillion in 2025. This amount surpassed spending on fossil fuels.
The U.S. remains a key market, with solar power installations alone expected to grow by more than 40 GW annually through 2030.
Corporations are an important driver of this trend. Companies now hold a larger share of renewable PPAs. This shift comes as investors, regulators, and consumers demand stronger climate commitments. Amazon has been the biggest buyer of renewable electricity worldwide since 2020.
Amazon’s deal with Avangrid sends a strong signal to the renewable sector. Corporate demand for clean power gives developers and financiers long-term certainty. This certainty helps make scaling projects easier. As more companies set science-based climate targets, the renewable PPA market is expected to keep expanding.
Industry forecasts say that corporate PPAs might make up 20–25% of new renewable capacity by 2030. Amazon’s scale gives it an outsized role in shaping this market. The company partners with developers like Avangrid. This helps unlock capital and speeds up the clean energy transition.
Amazon’s Hardest Climate Challenge
Amazon leads in renewable procurement, but it faces big challenges in hitting its 2040 net-zero target. The majority of its emissions come from Scope 3 sources, including suppliers, logistics, and product use by customers.
While renewable energy agreements cover operational electricity, tackling emissions across Amazon’s vast value chain will need deeper collaboration with partners and new technologies.
Analysts point out that Amazon’s total emissions haven’t dropped consistently. This shows the struggle between fast business growth and climate goals. For instance, even with renewable progress, Amazon’s overall footprint grew steadily during its years of fastest e-commerce expansion.
Balancing E-Commerce Expansion with Carbon Cuts
Amazon’s renewable energy strategy, like solar, is both a business and environmental decision. Access to low-cost clean power reduces long-term energy risks, while also positioning the company as a leader in climate action.
Partnerships with Avangrid and other developers boost the U.S. renewable energy market. They show that when companies demand clean energy, it can quicken the shift to clean electricity.
The U.S. renewable sector is set for strong growth in 2025, led by wind and storage, per S&P Global analysis. Wind power additions are projected at 15.7 GW, up 73% from 2024’s 9.1 GW. Energy storage is expected to triple, surging from 14.5 GW in 2024 to nearly 44 GW in 2025.
However, S&P Global cautions that some large wind and solar projects may face delays, with in-service dates potentially shifting beyond 2025. Overall, broad-based gains highlight accelerating momentum in the U.S. clean energy transition.
For Amazon, the challenge ahead lies in balancing growth with deeper emissions cuts. The Avangrid solar project represents progress, but a broader supply chain transformation will be needed to meet the 2040 net-zero target.
As more corporations follow Amazon’s lead, the renewable energy landscape in the U.S. is set for continued expansion. The success of these partnerships will help determine whether the country can meet its clean power goals and maintain momentum in the global shift away from fossil fuels.
