Bringing Renewable Energy to Business with General Motors’ Rob Threlkeld

March 4, 2015

JOHN SHEGERIAN: Welcome back to Green is Good. We’re so honored to have with us back on Green is Good General Motors. We’ve got Rob Threlkeld. He’s the Global Manager of Renewable Energy at GM. Welcome to Green is Good, Rob. ROB THRELKELD: Thank you, John. I appreciate being on the show and given a chance to highlight and demonstrate what we’re doing in the area of green and renewable energy. JOHN SHEGERIAN: GM has been a regular on Green is Good, and we’re so honored and thrilled to have you back on again. Your first turn on Green is Good, and you’ve got a great story. But before we get talking about all the great work you’re doing at GM, please tell us more about the Rob Threlkeld journey in sustainability and your young epiphanies of greenness and how you even started getting interested in the whole sustainability revolution, Rob. ROB THRELKELD: Certainly. It goes back, and it made my parents’ life very easy. When I chose my career back in second grade, when I learned a little bit about acid rain and its impact on the potential for the maple syrup production and the maple trees in the Northeast, and I was a huge fan of maple syrup back in the day, that put my focus on what I can do to improve the environment and reduce fossil fuel emissions and have a lot of interest in the environmental area and pursue that all the way through Purdue University, with a degree in civil engineering with an environmental strength. At that point, I joined General Motors and worked my way into the area where I am today, as the Global Manager of Renewable Energy and driving our corporate renewable goals and reducing our carbon footprint, especially with those projects. It’s been a great journey going back into the early years of my life, and it’s been one that I’ve thoroughly enjoyed and done a lot to help improve the area around sustainability. It’s been my heart and my interest going forward, and will continue to do that and instill that in my children and future generations as well. JOHN SHEGERIAN: It’s so funny. When I read about you, Rob, before we did this show and about how you love instilling this in your children, how they’ve already taken the mantle and how they’re running with it because of your great influence, and not only the talk that you talk, but the walk that you walk. Why I’m so excited about this show today with you is my father was one of the first people who brought over windmills and windmill technology to the United States and put up windmill farms. You don’t realize it when you’re a kid. You’re just thinking, that’s my great dad and he’s doing great things. But the impression that leaves on you to go do other things and take that mantle, so to me, wind power and the great stuff that you’re doing with regards to GM’s renewable energy is so exciting to me. To be talking about wind today and the car industry is really fascinating. I don’t want to take any more time, but I just wanted you to know that this is a real great story, and we’re so honored to have you on today. For our listeners out there who want to learn more about everything GM is doing in green, and they’re doing a lot, it’s gmsustainability.com. I’m on the website now. It’s a gorgeous website, and it’s chockfull of information of all the things that GM is doing in sustainability, way beyond wind and energy power, which we’re going to be talking about right now. Let’s talk a little bit about what you’re doing and how this journey started with regards to energy and wind and how you got focused on this specific topic and when did you launch the first wind-powered plant for GM? ROB THRELKELD: Actually, a lot of our initial activities, especially with onsite generation, whether it be owned by a third party or through General Motors, from a renewable energy standpoint, and we looked at the only way to really grow and drive a significant component and portion of our savings is to go offsite and look at procuring wind and having it transmitted to our facilities. As announced last week, we did our first large-scale wind PPA for our Mexican facilities. There will be 34 megawatts, supplying the bulk of that to our Toluca foundry there, casting engines and transmission facility, with the remaining portion of it going to our other facilities in Silao and Ramos. In all, it will be about a third of our power electricity used in Mexico will come from wind power. We are actively pursuing and looking at opportunities globally for where we can source large-scale offsite renewables, including wind. JOHN SHEGERIAN: First of all, two questions. One, how hard was it to choose where to do your first wind project, Mexico versus U.S. versus one of your other plants? How hard was that decision? ROB THRELKELD: You really look at the markets. Are they regulated or deregulated? You can easily start to exclude the regulated markets, which are many of the countries that we operate in. So we had to look at the deregulated markets, which really focused us back to the United States and Mexico. Mexico has got a great policy in place that really made the flexibility and risk mitigation when you look at any one manufacturing facility going down for facility modifications and where does that power go, the wind is still generating the flexibility to move power between facilities. We really look at it from a corporate risk perspective, as to how do we mitigate our risk as our manufacturing processes change over time when you’re entering into a long-term commitment. The deals for wind are 10-20 years. Our Mexico one is 12 years. It’s a long-term commitment, and you’ve got to look at how you mitigate that risk, especially with any plant. JOHN SHEGERIAN: When it comes down to technologies, the evolution of wind technology, how hard was it to choose the right kind of wind technology in terms of what you put up there versus what’s out there in the marketplace and where the market is going in terms of evolving wind technologies? ROB THRELKELD: The wind technology in the industry has really changed in the last 10 years. I would say it’s becoming more of a steady state. The cost of wind has come down dramatically in the last 10 years. Now, you’ve got different scalable wind turbines that are 1.5 megawatts, 2.5 megawatts, anywhere in between. We rely on the developer to match the best technology that’s available, as they’re the ones that are at risk and ensure that they’re generating, as we’ve got some components in our contract to ensure that they’re providing us the power, as well, to match the wind profile for that area for what is the best turbine technology and height that they need to generate the maximum efficiency from the wind turbines themselves. JOHN SHEGERIAN: Rob, what I always want to know about these kind of projects is what kind of anticipated cost savings do you have? This leads me to the bigger macro question, which I love when leaders like you, the Global Manager for Renewable Energy of GM, comes on the show. A lot of people, when I ask them, “How come your company is not being greener? How come you’re not being more environmentally responsible?” The old answer used to be it’s more expensive. It costs too much money. Can you sort of turn that on its head when you explain the cost savings you’re going to have from this project? Is being green really more expensive than not being green? ROB THRELKELD: That’s one of my pet peeves, and you picked right on it. In fact, they view renewables as a cost versus a cost savings. In many areas, wind is much more economical. You look at Texas and some of those other locations, Kansas, wind is cheaper than fossil fuel-based generation. We’re really trying to educate the public that these technologies are becoming more mainstream. The cost has come down significantly. Working through barriers, now, the biggest issue we’re trying to drive to 100 percent green are the regulations that are in place in regulated markets, even in deregulated markets. Part of the reason why we’ve joined the Buyers’ Principles, signed onto that with the World Wildlife Federation and World Resources Institute, a consortium of large companies that are interested in procuring wind and other renewables on a large-scale basis, how do we work that collaboratively, working with utilities and with regulators to make that work? Because it is cost effective. In Mexico, we’re saving in excess of roughly $2 million a year in our electricity costs by sourcing wind power, so there’s true savings associated with these projects. JOHN SHEGERIAN: $2 million a year. When you’re now thinking and you’re explaining to your colleagues the savings that’s involved, and of course the great visibility that it also brings to your company, because your consumers do care about how you do your business, and they’d love to hear these stories. What are you thinking about, now, in terms of wind for operations in other countries? What’s your current thought process on that right now, Rob? ROB THRELKELD: I mentioned the regulated versus deregulated markets, and we work down that path. In deregulated, it’s much easier to look at how you can source power to your facilities. That kind of brings us back into what other opportunities do we have in Mexico? What opportunities do we have here in the U.S. and deregulated markets, such as in Ohio or Texas? Those are some locations we’re definitely going to be looking at opportunities. Globally, when you get outside of North America, there’s good opportunities in Europe and then in Brazil. We really kind of focus it down that path of what are the deregulated markets. Those usually are the easiest barriers to work through. It’s still going to be complicated to work through those opportunities. This isn’t something you do overnight; it’s a six- to eight-month process when you look at negotiating and signing a PPA and building it out. Even the Mexican wind farm won’t come on until the first quarter of 2016. It’s being currently built now. JOHN SHEGERIAN: Got it. For our listeners who just joined us around the United States and around the world on the iHeart Media Network, we’ve got Rob Threlkeld. He’s the Global Manager of Renewable Energy at General Motors. To learn more about everything that’s going green at GM, go to gmsustainability.com. It’s a great website. Your position is Global Manager of Renewable Energy, so it’s not just about wind. You have a very diversified portfolio on solar, landfill, gas, waste energy. Explain about how diversified it is and what’s the benefits to having such a diversified portfolio, in terms of powering all your plants, Rob? ROB THRELKELD: I look at it similar to our diversified propulsion technology portfolio, from your standard combustion engine to plug-in hybrids to fuel cells. A similar strategy when it comes to procuring renewable energy. As you mentioned, we’ve got a large portfolio now. With the signing of the wind PPA, we’ve exceeded our 2020 manufacturing commitment of 125 megawatts. We’ve got a significant component of landfill gas generation at our Orion and Fort Wayne facilities. We’ve got roughly 46 megawatts of solar on our facilities globally, primarily that being in Europe, the United States, and then Korea at our Changwon facility. We recently just started up our large-scale 2.2-megawatt solar radar at our Lordstown facility in Ohio. That’s literally located right on the Ohio Turnpike. You won’t miss it when you’re driving by on the Ohio Turnpike. It’s probably the largest solar array that you’ll see right on an interstate, as visible as it is. JOHN SHEGERIAN: With your title, you’re the Global Manager of Renewable Energy, safe to say you have a lot of job security because GM is committed to using renewable energy around the world in all their plants. ROB THRELKELD: Yeah, it’s definitely safe to say. There’s a lot of focus from our top leadership on driving sustainability into our manufacturing processes and renewable energy is definitely visible and one of the significant cost savings opportunities, as mentioned. It’s a savings, so there’s a lot of push from our top leadership to look at opportunities where we can reduce our costs to fossil fuel-based generation. JOHN SHEGERIAN: If we take it out of the GM spectrum for a second and just for our listener out there who’s listening to all the interesting things you’re doing and GM is doing with regards to solar, landfill, gas, waste energy and, of course, now wind, for people who own homes out there, how do they make the right choice, Rob? Now, you, as a consumer, as a homeowner, with a family, how do you make the right choice about how to save energy in your home with regards to what kind of energy savings should they look for? Should they put solar on now? Is that the right way to go? Are there wind options for homes? Or is there cost savings options in terms of the new technologies like NEST and the other type of things that they should be doing to save energy in their homes? ROB THRELKELD: A big thing, a lot of the utilities are having a strong push on energy efficiency within homes. Solar is one of the components of that as well. I’m in the DT territory. I called up the local utility, they came out and did an energy efficiency assessment of my house, gave me some ideas of what I can do to improve the energy efficiency of my home, gave me some new light bulbs that are much more energy efficient than the current incandescent lights. I’ve now switched over to all LED lights. They did a thorough analysis of what I do. On a quarterly basis, they send a report out of your energy consumption in your home compared to a lot of your neighbors. You can see if you’re using a lot more energy. At least, for me, I keep a high focus to that, and then work with my kids to make sure they turn the lights off every night, which they seem to have a hard time doing. JOHN SHEGERIAN: All the regular blocking and tackling stuff that we all go through as fathers and parents and things of that such. Something I was reading about GM prior to us doing the show together, you’re a co-founding member of the Business Renewable Center. I’ve never heard of that. Can you explain to our listeners what the Business Renewable Center is, and what you’re doing as a co-founding member? ROB THRELKELD: Yeah, it is, as you mentioned, a new entity that’s been formed. It’s a consortium of companies that are there to share how we walk the process to do PPAs and share that internally with the organizations. So, how we did a PPA in Mexico, we kind of walk through the steps, the barriers, how did we overcome those barriers, what are some of the best practices or best contract terms or things that we thought that were worthy for us to look at ways that other companies can share that. It’s a collaborative kind of consortium to drive scale into renewable energy. It’s led by the Rocky Mountain Institute, which is one of the NGOs that has been focused. It’s kind of an offshoot of the Buyers’ Principles. The Buyers’ Principles for Renewable Energy with the World Wildlife Federation, we’re a resource institute. Our consortium of the large companies driving the applications that are needed to instill large-scale renewable energy, the Business Renewable Center is the offshoot of that, to really make that work and a mechanism to how PPAs and other large-scale renewables can be sourced. JOHN SHEGERIAN: Besides just the bottom line cost savings, which you’ve made the great case, $2 million a year just on the wind project, when it comes to renewable energy, what are the other tangible and intangible benefits that GM and your facilities get from powering your sites using renewable energy sources? ROB THRELKELD: Boy, you’ve pegged on the great question of how I work through finance on doing renewable energy projects. It really starts off on the financial side of what are we looking at from an electric savings? What are the incentives associated with it? What are we going to do with renewable energy credits? Everything financially that sort of drives the business case to say why it makes sense for us to do it, and then you come in with the intangible benefits of how it’s going to improve our image from a brand image standpoint, when you look at corporate green images, local contacts as we work with the universities and schools of what we’re doing to support energy efficiency and renewable energy, all the way down into the Lordstown project. You’re on the Ohio Turnpike. When you look at it from a marketing standpoint and cost per impression, there’s over 100 million people, not vehicles, but people that have the visible view of that plant when you drive by. It’s very visible, and you’re going to see a solar array there, and it kind of gives them the idea of what is General Motors doing when it comes to a green brand image, and it’s not just one project. They then go to gmsustainability.com and say, “They built that project. Whoa, there’s another 125 megawatts of renewables on their facilities.” It kind of goes all the way around from financials to the intangible benefits of how it supports the marketing and the vision and values of the company. JOHN SHEGERIAN: The wind project that we talked about in Mexico is going to help GM meet its goal of 125 megawatts of renewable energy by 2020. But Rob, you are a young guy and you’ve got a lot of energy and vision here. What are some of your goals for GM in renewables for the next few years ahead? ROB THRELKELD: It’s continually to drive to the point where we’ve got a renewable project or component to each of our manufacturing facilities, whether it’s 100 percent or whether it’s a component of 100 percent. It’s going to be working through those regulated barriers in countries where it’s more difficult to do renewable energy, but my vision and goal would be to try to drive this company as green as possible and to source as much green energy as we can. I’d love to get to 100 percent, but there’s a lot of barriers and obstacles that we would have to work through to do that. I’m a risk-taking person. To ensure that we’ve got the necessary risks also mitigated, but to take those forward to leadership to make sure that they understand there’s a risk, but here are the risk mitigated barriers that we’re going to do as we do these long-term commitments at our facilities. JOHN SHEGERIAN: Rob, final thoughts. We have a lot of young listeners in the United States and actually around the world. How can they be the next Rob? Give one or two thoughts on how the next generation should go about taking the mantle from you. ROB THRELKELD: It’s really taking it from what you do at home, recycling. We recycle more than what we actually put out in the trash, and my kids recognize that. What can you do at home? What can you do at work or at school to improve the environment? It’s taking that can and putting it in a recycling container versus putting it in the trash. Turn off the lights in the classroom or turn off the lights at home as you leave the office or leave the school or leave home. Those are the little things you can do, and all those little things add up if each person does that one by one. That multiplies to millions quickly. JOHN SHEGERIAN: Rob, thanks for coming on the show. We’re going to want you to come back. We’re going to want you to talk more about all the renewable energy projects you’re doing around the world. To learn more about GM and the great green things they’re doing in sustainability, it’s gmsustainability.com. Thank you, Rob, for being an inspirational renewable energy rock star. You are truly living proof that green is good.