US Army Rolling Out $7B Renewable Energy Buy

It’s not like the U.S. Army has been standing still on renewable energy. Not at all. Energy performance savings contracts (which pay the developer through savings that flow from projects) have driven projects at bases from Texas to Puerto Rico and who can forget the recently completed solar power plant at White Sands in New Mexico, which happens to be the world’s largest low concentrating PV plant?

But the big gun in the Army’s renewable energy arsenal goes by the name Renewable and Alternative Energy Power Production for DoD Installations, and uses a device called MATOC – Multiple Award Task Order Contracts – that will give the service the ability to source $7 billion in renewable energy.

army renewable energy $7 billion

Photo illustration of White Sands solar array (image via U.S. Army)

This is an initiative that has its roots in Bush 43-era legislation and has been step-by-step developed by the Obama Department of Defense over the past couple of years. Now an initial round of contracts has gone out to five companies that will help hook the Army up with geothermal power. According to the Army:

The five companies awarded contracts for use in competing and awarding PPA task orders using geothermal technology are Constellation NewEnergy, Baltimore, Md.; ECC Renewables, Burlingame, Calif.; Enel Green Power North America , Andover, Mass.; LTC Federal, Detroit; and Siemens Government Technologies, Arlington, Va. The contracts provide a three-year base with seven one-year options, for a total ordering period of 10 years.  Having these contracts in place will expedite the acquisition process for future projects.

As the term “PPA” – power purchase agreement – indicates, these deals won’t lead to the Army owning renewable energy generating facilities; instead, the developers, using private financing, will. In a sense, the Army will take advantage of the kind of utility-bill-trimming arrangements that are driving so many companies and homeowners to go solar these days. This financing allows the military to join in the distributed energy bonanza.

“In our current fiscal environment, attracting third-party money to build renewable energy production facilities that will allow military installations to purchase energy at a pre-determined rate without building, owning and maintaining the facility is the right thing to do,” said Col. Robert Ruch , Huntsville Center commander.

This first round of contracts focused on geothermal is just the beginning of a parade of announcements that the Army is promising. “Announcement of awards for the remaining technologies, solar, wind and biomass, are anticipated for staggered release through the end of calendar year 2013,” the service said.

What’s driving this push for renewables? Well, it all began with the Defense Authorization Act for fiscal year 2007 – passed in 2006 under a Republican Congress and signed into law by President George W. Bush – that codified the military’s goal to “produce or procure not less than 25% of the total electric energy it consumes during FY2025 and thereafter from renewable energy sources.”

Building on that, in April 2012 President Obama vowed that the U.S. would deploy 3 GW of renewable energy—comprising solar, wind, biomass and geothermal—across all the services by 2025.

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