The U.S. Navy is purchasing electric vehicles built by e-Ride industries in Minnesota. (Photo by Argonne National Laboratory)

The U.S. Navy is purchasing electric vehicles built by e-Ride industries in Minnesota. (Photo by Argonne National Laboratory)

Military’s green push could mean big business in Midwest

November 1, 2011

By Frank Jossi

Five Minnesota-made electric vehicles with rooftop solar panels will soon find homes at Naval bases in Texas and Mississippi.

Manufactured by e-Ride Industries in Princeton, the low-speed vehicles can travel between 40 and 45 miles on a single charge and have the same power as a gasoline-powered small pickup.

E-Ride is among the many Midwest firms vying for business from the Department of Defense for good reason. The DOD has become a major federal funder of green projects, with $1.2 billion spent in 2010 alone. It’s also funding research through other initiatives, such as a collaboration with the Department of Energy called the Advanced Research Projects Agency, or ARPA-e.

In fact, the military set up a website, DoD Goes Green, just to track all the activity.

Every service branch is participating in green energy procurement and research, according to Phyllis Cuttino of the Pew Project on National Security Energy and Climate.

Released in September, Pew’s report “From Barracks to Battlefield: Clean Energy Innovation and America’s Armed Forces” details the armed services push for greener bases, supply chains and more renewable energy and technology for soldiers in battle.

The Pentagon’s continued support of greener energy is a potential game-changer because of its enormity. The military spends more than $400 billion on goods and services every year, a good portion of it on new technology.

And it has an enviable record of invention ranging from electronics to computing (the Internet was originally a military project), space technology to to satellites, nuclear energy to GPS. Could it do for sustainability what it did space and cyberspace?

Making the military green

The Pew report focuses on vehicle development, advanced biofuels and energy management, including energy storage and building efficiency.  The Midwest’s strength in precision manufacturing, battery storage, solar panel production and biofuel development should make it a contender for DoD money, says Cuttino.

“Innovation is not all located in California or Massachusetts,” she said.

The DoD uses a lot of energy, and its leaders know it. The military consumes 300,000 barrels of oil a day, much of it transported by convoys vulnerable to attack –- more than 1,100 were attacked last year alone in Iraq and Afghanistan, leading to more 3,000 injuries and deaths, said Cuttino.

A typical soldier in battle uses 22 gallons of oil a day, a 174 percent increase over the Vietnam War.

“They have all these problems with costs, with volatility, with operational risks,” she said. “What DoD has said to itself is we have to re-examine the way we approach energy.”

The sheer magnitude of the DoD’s operations begs for more energy conservation. The military has 500 sites containing 500,000 buildings, three times as many structures as Walmart manages. Many large bases had one power meter that would collectively measure all energy use rather than metering individual buildings, she said.

The military buys most of its electricity from utility companies today but the Pew report suggests in the future, bases could become self-sustaining “microgrids” powered by renewable energy.

In all, the military has more than 450 projects involving wind, geothermal, biomass and solar energy, the report noted. Those projects helped the military draw 9.6 percent of its power from renewable sources.

The Midwest steps up

To that end, retired U.S. Navy officer Chip Laingen runs the Small Business Administration’s Advanced Power and Energy Cluster (APEC) in Minneapolis. He’s has been working in Minnesota and the Dakotas with a number of small companies looking to land military contracts.

The APEC is part of the Defense Alliance, which focuses on attracting DoD contracts in a variety of fields, not just energy. So far the APEC has helped companies land $6.6 million in contracts, creating more than 140 full- and part-time positions.

Of the organization’s 82 members, around 25 are actively looking to land contracts involving sustainability, include Fargo-based Packet Digital, a power management software provider; Silicon Energy, a Washington state solar panel manufacturer with a facility in northern Minnesota; Lloyd’s System, a Rapid City, South Dakota, manufacturer of duct cleaning robots; and e-Ride.

A couple of roadblocks Laingen sees for the Upper Midwest is the reality of being in “flyover territory” and a general apprehension with being involved in military projects.

“Some people don’t believe the military cares about this (renewable energy) stuff, but the smart ones look at the military’s investment and say ‘wow, there’s that much money there?'” he says.

The DoD will spend $3 billion on renewables by 2015 and $10 billion by 2030. Meanwhile, the money has flown steadily to improving bases throughout the country and in the Midwest.

In Minneapolis, the 934th Airlift Wing retrofitted its entire base to reduce carbon emissions and save energy. The 148th Fighter Wing in Duluth installed five wind turbine generators and the Arden Hills Army Training Site set a goal to reduce energy use by 30 percent through district heating, solar thermal and solar electric systems.

Similar projects have been undertaken at bases in Ohio, Indiana and Michigan.

In Wisconsin, Eaton Corp., along with the University of Wisconsin and ZBB Energy Corp., is working on a microgrid project for the Fort Sill, Okla. Army base. ZBB is also involved in an energy storage system to be installed at a naval base near Los Angeles.

Virent, a 110-person firm in Madison, has a good chance at landing a contract with the Navy to help build $510 million of biorefineries for biofuel production. Helios Solar Works, Inc., based in Milwaukee, will be supplying solar panels to the Army under a contract with Arista Power of New York.

The battery company Dow Kokam -– a partnership of Dow Chemical, TK Advanced Battery, LLC and Groupe Industriel Marcel Dassault (Dassault) -– is building a plant that will employ 800 people in Midland, Michigan, funded in part by a $161 million Department of Energy grant. Batteries produced there and in Lee’s Summit, Missouri, will be used by the military for aerospace and land-based operations.

ARPA-e’s list of projects, meanwhile, includes several Big 10 schools, including Ohio State, Minnesota and Michigan.

At e-Ride there’s a sense of optimism based on the potential for more sales as the entire federal government — and not just the DoD — goes green. Erik Crawford, who leads up federal sales, said the U.S. Postal Service is doing a pilot with e-Ride now that could result in significant sales.

The reason for the interest of the postal service and the DoD is that e-Ride’s vehicles are not simply glorified golf carts but instead have the characteristics of small pickup trucks.  Kevin Bauerly, e-Ride’s general manager, said that e-Ride “is in general cheaper than traditional small pickups” and cost less to operate over the lifecycle of the vehicles.

The vehicles have even been used at the McMurdo research station in Antarctica.

So far federal sales have been a small part of e-Ride’s revenue, an issue that could change dramatically, and quickly.

“Our concern is growing too quickly, because the deals we’re in the running for pale compared to the company’s previous sales by quite a bit,” Crawford pointed out. “They could double the size of the company very rapidly.”

St. Paul journalist Frank Jossi writes about politics, business, energy and the environment. His website is www.jossi.biz.

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5 thoughts on “Military’s green push could mean big business in Midwest

  1. How much did we, the taxpayer, pay for the vehicles? And did we subsidize the R&D and manufacturing of these vehicles as well? The DoD is notorious for paying far more than is necessary for items: $500.00 toilet seats were purchased one year. On the surface this seems like such a great idea, but I’m sure that if someone were to report the associated costs we’d see that the taxpayer is once again getting soaked.

  2. Investments in technology are necessary for the US to compete in the world.

    Yes, the US government makes investments with taxpayer money. And like any investment some work out very well while others flop. Investments into the DoD gave us the first Email and the beginnings of GPS. Were those not worth taxpayer money? Have they not benefited the taxpayer?

    Obviously some government expenses are nonsensical (the toilet you mentioned is likely one of them), but one bad egg does not mean the entire clutch is worthless. We need alternatives to using oil and it is imperative that we invest wisely in possible alternatives. Especially as technology becomes more complex and expensive, small companies and entrepreneurs need support to bring their ideas to fruition.

  3. This is a giant boondoggle which will send the DOD budget soaring. An example is the $510 million program to build cellulose plants for jet fuel when we have no good production process for cellulose or algae.

  4. The majority of these electric vehicle companies including e-ride have not recieved any funding from the government (tax payers money) for R&D. They are are local, small business’ that have private investments and have grown on cash flow. In the end, if the vehicles work like they are supposed to, purchasing these vehicles should only save money.

  5. Investment in renewable energy increases our energy independence, thereby decreasing our involvement in wars for oil. We are already spending tax dollars on the DoD’s operational costs. I am much happier knowing that my money is going toward creating jobs in our country, reducing pollution, and saving lives.