With the launch of a new 180 megawatt solar energy project in Arkansas, General Motors will gain the power needed renewable power to run two of its biggest assembly plants, with enough left over to partially operate a third.
The deal with First Solar Inc. marks the latest of three big renewable energy projects announced this year and will mean that by 2023, GM will rely on solar and wind power to provide more than 60% if its U.S. energy needs. The automaker intends to reach 100% by 2030 in its home market.
“As GM continues its transition to an all-electric, zero-emissions future, it is imperative that we also invest in a cleaner grid that can support everything – from our factories to our vehicles,” said GM Chief Sustainability Officer Dane Parker.
The largest of the Detroit automakers isn’t the only manufacturer making the switch from fossil fuel-sourced energy to renewable alternatives. More than 250 major companies worldwide have laid out similar plans and a number of other automakers, including Volkswagen and Ford, are also expanding their wind and solar sourcing.
GM, however, has aggressively sped up its own transition. Its original goal was to reach 100% sustainable power both in the U.S. and globally by 2050. But several factors have led it to accelerate its efforts.
Early on, the use of clean energy was largely done for promotional purposes but it has become not only economically viable but advantageous, said Rob Threlkeld, GM’s global manager of sustainable energy. When the automaker turned to solar for a California parts depot, its first project, in 2005, the technology cost a hefty $9 per watt of power. Now, that’s “less than $1 a watt, a quite significant cost reduction,” said Threlkeld, “and costs are still coming down,” that not as quickly.
The decline reflects a variety of factors, including newer technology able to produce more power, whether from sun or solar sources, as well as advances in how alternative systems are sited. There’s also increasing economies of scale as more businesses – and homes – turn to renewable energy.
Going sustainable also puts GM in a better position from a regulatory standpoint. More and more countries are now using carrot-and-stick approaches, such as cap-and-trade, to encourage businesses to switch. And GM wants to be ready if that happens in the U.S., something that might be possible under a Biden presidency, the Democratic candidate calling for new guidelines to reduce emissions of global warming gases like carbon dioxide.
“You’re financial doing the right thing for the company and managing for future risk,” said Threlkeld, “and you’re doing the right thing for the planet.”
At the beginning of the year, GM was sourcing about 23% of its U.S. energy supply from sustainable sources. It is now set to reach 60% by 2023 with the three deals it has inked this year. That includes programs with the TVA and Michigan’s DTE.
The latest deal pairs it with First Solar, one of the world’s nine largest solar energy providers. The project will provide 180 megawatts of energy from a base in Arkansas, enough to power an estimated 47,882 U.S. homes. For GM, however, it will provide all the energy requirements for its Wentzville (Missouri) and Lansing Delta Township (Michigan) Assembly Plants, with some additional power for a second plant near the Michigan state capitol.
All told, the three projects will boost to 1 gigawatt GM’s annual renewable energy supply.
Renewables do have some drawbacks, acknowledged Threlkeld, “days when the weather doesn’t cooperate.” At those times, the company still will be able to draw energy from the existing grid. Meanwhile, GM is among the many renewable energy users exploring the idea of adding large backup battery systems that will be able to store energy for such occasions and then “load level,” or even out demand, at periods of higher-than-normal usage or unusual shortages of energy supplies.
The automaker was an early proponent of reusing battery packs from electrified vehicles taken off the road at the end of their life. Most batteries are still expected to have significant amounts of capacity left at that point. A recently released study by the Boston Consulting Group estimated that by 2030 as much as a third of automotive batteries would eventually find such “second life” applications.