US Army Calling for Major Investments in Renewable Energy

This September, the US Army established the Energy Initiatives Office Task Force in conjunction with announcing the ambitious goal of meeting over 25 percent of its energy demand through renewable sources by 2025.


The US Army is promoting renewable energy as a practical solution to pressing security, economic, and environmental challenges. Source: US Army

This initiative is part of a larger agenda within the Department of Defense to promote renewable energy as a cost-effective security measure. Over the last decade, rising energy costs have increasingly strained military budgets and concerns over fuel convoy and supply security have risen to the fore. As an organization, the US Army currently spends over US $4 billion per year on energy to power bases, installations, transport vehicles, and equipment around the world. The projected costs of the status quo, that is, maintaining a fossil fuel-based energy mix, have proven unsustainable to top military leaders. For example, with every US $1 increase in global oil prices, the US Army’s energy budget can fluctuate by over US $30 million. The Army has indicated that in addition to its environmental benefits, ramping up renewable energy makes sense from both an economic and national security perspective. Secretary of the US Army John M. McHugh recently stated that “The Energy Initiatives Office Task Force will help the Army build resilience through renewable energy while streamlining our business practices so developers can invest in and build an economically viable, large-scale renewable energy infrastructure”.

As one of the largest energy consumers in the world, the US Army’s adoption of such aggressive renewable energy policies will be a major boon to the US and global renewable energy industries. The Energy Initiatives Office (EIO) Task Force estimates that the US Army will need an additional 2.5 million megawatt-hours (MWh) per year of additional renewable energy supply over the next 10 years to meet its 25 percent goal.  A recent Pike Research report on US military energy initiatives finds that the renewable energy investments from the Army and other branches of the military will top US $10 billion annually by 2030 and continue to grow. Some analysts estimate that the US Army alone may attract over US $7 billion in private financing for renewable energy and energy efficiency projects over the next five years. This increase in demand can provide manufacturers and generators the long-term financial security they need to make significant structural investments in renewable energy production and innovation.

Currently, the US Army’s EIO Task Force is developing strategies to increase investor confidence and position army installations as a prime, low-risk, market for private-sector investments in renewable energy projects.  A major advantage that military institutions have is a vast amount of land resources.  The US Army alone owns over 15 million acres of land, much of it suitable for solar, wind, and geothermal development. Currently, much of this land is left unused as a buffer between military activities and local communities.  By offering large tracks for little to no cost to renewable energy developers, the US Army is leveraging the value of the land to secure long-term power purchase agreements (PPAs) with private renewable energy companies.  It is seen as a win-win situation by offering clean and stable energy supply for Army bases as well as financial certainty for the renewable energy industry.  At this point, the US Army has identified over 5 million acres of real estate that could be offered to renewable energy suppliers, with the intent of attracting billions of dollars in investment over the next ten years.  Twenty utility-scale projects comprising solar, wind, geothermal, and biogas have already been proposed under this arrangement.

Overall, the entire Department of Defense is poising itself to be a central driver of renewable energy investment in both the United States and international markets.  For the US Army’s part, a major pillar of the new push for renewable energy is what is referred to as the “net-zero energy installation” (NZEI).  For an army base or installation to claim NZEI status, it must implement a comprehensive energy strategy that produces as much energy on-site as it uses over the course of a year.  Currently, the US Army has six active NZEI pilot projects in the continental US and one in the Marshall Islands.  In addition to NZEI projects, many of the Army’s largest installations have begun incorporating renewable energy into their portfolios with increasing success.  Fort Bliss, a massive installation spanning 1,700 square miles between Texas and New Mexico, has saved over US $2.7 million in energy costs since implementing an aggressive energy efficiency policy and is currently working on plans to expand solar and wind capacity by a further 80-150 MW across the base over the next 3 years.

Historically, the US Army has served as a catalyst in developing and scaling innovative technologies, such as the internet and GPS technology, for mass markets.  Given the current economic climate and Congressional reluctance to implement significant energy policy, the military has an opportunity to break technology and policy ground with respect to renewable energy. Net-zero energy, 25 percent renewable energy policies, and innovative “land for renewables” swaps all have the potential to play a major role in mainstreaming renewable energy technologies and to give the industry as a whole a welcome boost.  By providing examples of efficient and profitable large-scale energy projects, the Army may well prove itself to be a vital link in bringing renewable energy to the masses as well.

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