United States

United States

Ford plans for own wind-gas power supply -- Motor company negotiating green energy utility deal in Michigan

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Ford Motor Co is working on a cutting-edge green marketing proposal -- which includes a 20 MW wind farm -- with utility Detroit Edison to supply electricity to the giant motor company in its home state of Michigan. The project, which had yet to be firmed up in August, is being brokered by Environmental Resources Trust (ERT), an offshoot of the respected Environmental Defence Fund.

The power supply being proposed for Ford consists of 20 MW of wind and 50 MW of gas, a combination which looks set to become a trend in the US. Four months ago a gas-wind deal was clinched in Minnesota by Northern States Power (Windpower Monthly, May 2000) to ensure a firm power supply to customers even when the wind stops blowing.

If the Ford project goes ahead, the parties would want it completed by the end of next year to take advantage of wind's Production Tax Credit (PTC) in case it is not extended beyond December 31, 2001. The mixed facility would be sited in Michigan and developed by a company named Bay Wind Power of Grand Rapids. ERT brokers clean energy deals for large end-users, including carbon trading

Increasingly attractive

Alden Hathaway of ERT, an energy consultant for 15 years, confirms the preliminary details. He cautions, however, that there is much work remaining if the deal is to be inked. That wind power is part of the negotiations -- and has been for some months -- he sees as highly encouraging: "There is a desire among all the parties to see wind built in Michigan," says Hathaway. And if the plant is delayed, he says, the wind component becomes more likely. "The longer we go, the more wind will be seen as a mitigating factor because of rising [natural] gas and electricity prices."

The wind farm is reportedly slated to be sited near Lake Huron, although that could not be confirmed. Bay Wind Power, new to the wind scene, appears to be well connected politically. It is headed by Richard Vander Veen, son of a former Michigan congressman.

Ford is among a growing number of huge businesses -- from IBM to BP Amoco and Shell -- that are turning to green electricity because of their public image and to hedge their bets against taxes on carbon or global warming gases and against fuel price increases.

Oil company BP Amoco, which has just dropped the name Amoco from its name, claiming BP no longer stands for British Petroleum but "beyond petroleum," recently said it would double its investment in renewables to $500 million, with most going to solar. BP was embarrassed earlier in the year by a shareholder resolution led by Greenpeace calling for increased investment in renewables instead of more Arctic oil exploration.

Ford's proposed wind plant, albeit small, would be a strong statement -- coming as it does from a company that is a household name around the world -- that wind is a competitive near term solution. Ford spends about $300 million a year on power for its manufacturing plants and offices in North America.

There have been a number of signs that Ford is seeking to be more environmentally responsible. It has quit the Global Climate Coalition, a lobbying group that leads opposition to the Kyoto protocol. Other companies that have quit include British Petroleum, Shell Oil, DaimlerChrysler and Dow Chemical. Ford and DaimlerChrysler, however, still oppose Kyoto and favour working voluntarily with other companies on technology-based solutions.

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