Nike Power Purchase Agreement

Nike’s Power Purchase Agreement: A Game-Changer in Sustainable Energy

In 2018, global sportswear giant Nike entered into a power purchase agreement (PPA) with Avangrid Renewables, a leading provider of clean energy in the United States. This move positioned Nike as one of the biggest corporate buyers of renewable energy in the world and set an example for other corporations to follow suit. Here, we explore the details of Nike’s PPA and the benefits it brings to the company, the environment, and the economy.

What is a Power Purchase Agreement?

A PPA is a contract between an electricity generator and a buyer, in which the generator agrees to sell electricity to the buyer at a fixed price for a specified period. This type of agreement allows companies to secure long-term access to renewable energy, such as wind or solar power, and reduce their dependence on fossil fuels. PPAs are becoming increasingly popular among corporations that seek to meet their sustainability goals and reduce their carbon footprint.

Nike’s PPA with Avangrid Renewables

Under the terms of the PPA, Nike agreed to purchase 86 megawatts of wind energy from Avangrid’s Texas-based Red Dirt wind farm. This amount is equivalent to the electricity needed to power 400,000 US homes per year. The contract will last for ten years, during which Nike will pay a fixed rate for the renewable energy, providing price stability and reducing the risk of price fluctuations in the volatile energy market.

Benefits of Nike’s PPA

The benefits of Nike’s PPA are multi-fold. Firstly, the company has committed to reducing its carbon footprint by using renewable energy, which aligns with its sustainability targets. According to Hannah Jones, Nike’s chief sustainability officer, the PPA will enable Nike to avoid the emission of 1.4 million metric tons of carbon dioxide over the next ten years, which is equivalent to removing 300,000 cars from the road each year.

Secondly, the PPA supports the growth of renewable energy infrastructure in the US, which creates jobs and drives economic growth. According to a report by the American Wind Energy Association, the wind energy sector has created more than 114,000 jobs in the US and contributes $20 billion to the economy annually. Nike’s PPA helps to sustain this growth and create a more stable market for renewable energy.

Finally, the PPA provides Nike with price stability and risk mitigation, as the fixed rate for the renewable energy protects the company from fluctuations in the energy market. This supports Nike’s long-term financial planning and helps the company to remain competitive in the industry.


Nike’s PPA with Avangrid Renewables is a significant step towards a more sustainable future and sets an example for other corporations to follow. By committing to renewable energy, Nike reduces its carbon footprint, supports economic growth, and secures long-term access to stable energy prices. As the world transitions to a low-carbon economy, PPAs are becoming an increasingly popular tool for corporations to achieve their sustainability goals, and Nike’s leadership in this area is commendable.