Ford, Porsche Each Announce New Renewable Energy Deals
(Ford CEO Jim Farley. Photo via Ford.)
Ford and Detroit-based energy company DTE have entered a purchase agreement for 650 megawatts of new solar power, the automaker announced in an August 10 press release.
The American automaker said the new solar power installations—the company isn’t tapping into an existing supply—will enable it to match 100% of the electricity consumption at its Michigan-based factories with renewable energy purchases by 2025. According to the press release, this is the largest renewable energy purchase ever made in the United States from a utility company.
“This unprecedented agreement is all about a greener and brighter future for Ford and for Michigan,” said Jim Farley, Ford’s president and CEO, in the press release. “Today is an example of what it looks like to lead … to turn talk into action.”
Ford estimates that it will avoid 600,000 tons of carbon dioxide emissions once the installed solar panels are fully operational. These emissions fall under the category of Scope 2, which are indirect emissions caused by the purchase of power. According to Ford’s 2021 climate change report, its 2020 North American Scope 2 emissions were 1,887,669 million tons of CO2. In addition to the United States, Ford also has manufacturing plants in Mexico and Canada.
Ford is entering into what is known as a power purchase agreement (PPA) with DTE, which encourages utilities to build new renewable energy projects by securing demand for the energy in advance. PPAs are typically used by massive companies—Google is a major proponent of them—to boost local supplies of renewable energy.
Ford’s deal with DTE doesn’t mean that every lightbulb at its nine Michigan factories will be powered by solar energy. That’s because the grid itself doesn’t have separate power lines for renewable energy and energy from coal-fired power plants. It’s all mixed together, meaning the best Ford can do is match its total energy consumption with corresponding green energy purchases from local sources.
(The Porsche Experience Center in Atlanta. Photo via Jaime Castrillon for Unsplash.)
Porsche Signs Deal for On-site Solar Microgrid
In addition to Ford, German luxury automaker Porsche also recently announced a deal to secure more solar energy to power its American operations. That said, Porsche is taking a much different tactic.
Porsche has struck a deal with renewable energy provider Cherry Street Energy (CSE) to install a solar microgrid at its North American headquarters in Atlanta, the automaker announced in a press release on August 15.
In the press release, Porsche said the new microgrid would generate 2,050 megawatt-hours of electricity annually, enough power to supply 191 average American homes for a year. According to Porsche, the microgrid will provide “a significant portion” of its annual energy needs once it’s completed in 2023.
“This solar project contributes to the overall sustainability targets of Porsche,” said Kjell Gruner, president and CEO of Porsche Cars North America, in the press release. “In 2030, Porsche aims to be CO2 net neutral across the entire value chain and life cycle of newly sold vehicles.”
Porsche said the microgrid will lead to an estimated reduction of 3.2 million pounds of CO2 per year, or 3.6 million miles of driving by the automaker’s estimate. Emissions are measured in tons, though, and Porsche’s microgrid will lead to a savings of 1,600 tons of CO2 per year.
It’s important to note that, unlike Ford, Porsche will be able to guarantee that a specific portion of the electricity powering its Atlanta HQ is renewable. This is because its microgrid is directly connected to its facilities, although it is also connected to the general grid.
The microgrid installation will take the form of solar panels placed atop Porsche’s existing and planned buildings. In addition to its corporate headquarters, the Atlanta site is also home to the Porsche Experience Center, a racing track where drivers can take lessons; and a service center. A second Experience Center is currently being built and a restoration center for classic Porsches is also planned.
CSE will own and operate the grid, selling the power to Porsche at what the press release referred to as “stabilized rates” for 25 years.