Rivian (NASDAQ:RIVN) announced this week that it has entered into an agreement with renewables company Pivot Energy to purchase renewable energy certificates. This is part of its plan to ensure that its Normal, Illinois plant runs on 100% renewable energy by 2030.
Pivot Energy will provide 60 megawatts direct current for community solar projects in Illinois. Rivian has put forward plans to buy renewable energy certificates from a 50 megawatts direct current development as part of the deal.
Rivian is among the EV stocks that have seen considerable pressure over the past 12 months. On a year-to-date basis, RIVN stock remains down more than 50%.
RIVN Stock on Watch as Rivian Goes Green
Most investors who focus on the electric vehicle sector like to tout the zero-emission status of EVs at the source.
The thing is, producing EVs requires a lot of energy. Experts have shared several environmental concerns regarding how metals are mined for batteries, for instance. Further, in most parts of the United States, electricity generation requires the use of fossil fuels, meaning electricity is not as green as many think.
This makes a push from Rivian Rivian to be more environmentally sustainable notable. This is a partnership that should be beneficial for both Rivian and Pivot Energy over the long term.
Solar power generation is going to be key for the onshoring and reindustrialization trends we are seeing in the U.S. market. The fact that Rivian is taking this step forward is encouraging, although investors will likely want to see more specifics on how much this deal will cost over the long term. Investors will also want to know more about how Rivian plans to make its plant run on 100% renewable sources.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
