Under its 15-year Virtual Power Purchase Agreement (VPPA) with EDP Renewables North America, Cummins provides certainty that enables the project to move forward as it guarantees a fixed price for the electricity produced by the expansion. Cummins benefits as the VPPA provides a hedge against rising energy prices and the company will receive the renewable energy certificates to ensure greenhouse gas reductions.

“At Cummins, our strategy is to provide clean, fuel efficient and dependable power for our customers with the least environmental impact possible,” said Brian Mormino, Executive Director of Worldwide Environmental Strategy and Compliance at Cummins. “Greenhouse gases are our largest impact, and we are currently working on our third facility greenhouse gas reduction goal since 2006.

“As we explored ways to even further reduce these emissions, we learned we could add to the renewable energy market in our headquarters state,” he said. “That led us to this partnership with EDP Renewables to add low-carbon energy capacity in Indiana that will benefit the environment and the community for a long time to come.”

EYE ON EFFICIENCY

Low-carbon electrons sold to the grid can’t be separated and delivered to an individual customer. VPPAs provide a mechanism for companies like Cummins to encourage the efficient production of low-carbon energy over an extended period of time. The agreements are increasingly popular among companies that want to add low-carbon sources of power to their energy mix but have facilities in locations that don’t lend themselves to wind or solar power production.

The Cummins’ portion of the Meadow Lake Wind Farm expansion, for example, will produce the same amount of energy generated by about a square mile of solar panels.

As part of its revised energy and greenhouse gas goals in 2016, Cummins pledged to increase the amount of energy it uses from renewable sources. The company already has solar arrays at 11 facilities with plans for more. The VPPA with Meadow Lake, however, offers the potential for a significantly bigger impact. The expansion will add 75 megawatts, enough to power approximately 20,000 average Indiana homes, to the existing 600 megawatt capacity at Meadow Lake.

Northwest Indiana is the windiest part of the state and well suited for wind farms. Indiana currently has more than 1,000 wind turbines, many of them clustered in northwest corner of the state and visible from the I-65 interstate highway between Indianapolis and Chicago.

“With all of our environmental sustainability goals, we want to maximize our impact,” said Mark Dhennin, Director, Energy and Environment at Cummins. “Though it’s impractical to transfer the power directly to our facilities, it was very important to us to choose a project that added real renewable energy capacity in the marketplace while providing tangible environmental and community benefits. Our analysis showed that supporting wind power through a VPPA was the most cost effective way to achieve the greatest greenhouse gas reduction in Indiana.”

CAPABLE PARTNERS

EDP Renewables North America and its subsidiaries develop, construct, own and operate wind farms and solar parks throughout North America, with 41 wind farms and two solar parks. The company is excited about expanding its Meadow Lake facility, slated for completion in 2019.

“EDPR NA has the largest wind energy capacity footprint in the state of Indiana and is pleased to partner with Indiana-based Cummins to help in meeting its energy and environmental goals,” said Ryan Brown, EDPR NA Executive Vice President – Eastern Region and Canada. “Cummins’ investment in low-cost, renewable energy shows its commitment to keeping our world a cleaner, healthier place to live.”

Northwest Indiana government officials are also excited about the expansion.

“Benton County is very excited about Cummins and EDP joining forces in our wind arena,” said Bryan Berry, President of the Benton County Commissioners. “The winds of Benton County are producing jobs and adding accessed value that lowers taxes for the residents of Benton County while expanding essential services like paramedics to better serve our community.”