CVS Health Corporation (NYSE: CVS) has secured an 18-megawatt agreement with Constellation Energy Corporation (NASDAQ: CEG) to purchase clean, renewable energy. This deal will cover the electricity needs of all 147 CVS Health locations throughout Michigan. The agreement is set to have a significant impact on the company’s carbon footprint. This announcement has caused CVS shares to experience a sharp decline of 7.76%, closing at $66.65 on Wednesday.
The agreement, set to begin in April 2025, spans 12 years and will see CVS Health procure energy and renewable energy certificates (RECs) from Swift Current Energy’s Double Black Diamond Solar Project in Illinois. The long-term collaboration between Constellation and Swift Current Energy enables Constellation to purchase a portion of the energy and RECs generated by Double Black Diamond. The construction of this project started in March 2023.
Through this agreement, CVS Health is expected to acquire approximately 35,000 megawatt hours of energy per year from Double Black Diamond. This move will significantly contribute to reducing the company’s carbon footprint, estimated to be around 17,000 metric tons annually. To put this into perspective, it is equivalent to the emissions produced by nearly 3,800 gasoline-powered passenger vehicles driven for one year, according to the U.S. EPA greenhouse gas equivalencies.
CVS Health has opted to utilize the Constellation Offsite Renewables (CORe) product to streamline its renewable energy transaction. CORe connects customers to large-scale, offsite renewable energy projects, enabling them to enjoy both economic and sustainability benefits. CORe is part of Constellation’s range of retail power products designed to help customers achieve their carbon reduction goals. In addition, customers have the opportunity to utilize regionally produced hourly carbon-free energy matching solutions, ensuring power is available when it’s most needed.
This move toward renewable energy aligns with CVS Health’s commitment to reducing its environmental impact. The company has gained recognition as a corporate leader in climate action, with its net-zero targets validated by the Science-Based Target Initiative. CVS Health continues to implement measures to lower resource consumption across its operations, including lighting and transportation upgrades, optimizing digital solutions to reduce paper usage, offering alternatives to single-use bags, and providing environmentally friendly products to customers.