Corporate sustainability big-wigs embrace Bloom Energy approach

My colleague Larry Dignan here at SmartPlanet provides a great update about a shift in business model from Bloom Energy, the hot (or cool, depending on how you view it) power start-up that has developed a sort-of fuel cell energy “server” technology that featured prominently on CBS 60 Minutes last year. Now instead of buying a Bloom Box outright, you can “buy” it as a service, which make sense because when was the last time your company built your own power plant?

This approach marries the traditional electricity service delivery model with the cloud computing service model, under which a company gains access to certain technology features without actually buying the technology outright. Don’t like the approach? Shut it off when the contract is over, without forking out a lot of money for technology that might not work for your business.

What is interesting to me is the highly visible companies that have already gravitated toward the Bloom Electrons approach. The following are already on board publicly and plan to commit to the new Bloom Electrons service: The Coca-Cola Co., Staples, Walmart, Kaiser Permanente, Becton, and Dickinson and Co. Bloom Energy has also scored the California Institute of Technology as an early customer for Bloom Electrons. (By the way, this doesn’t count other companies that have bought Bloom Box technology outright, such as software developer Adobe Systems.)

I heard directly from Kaiser Permanente about its plans, because I have been following some of the things that the healthcare organization has been doing with respect to renewable energy, in particular solar energy. Under its new deal with Bloom, Kaiser Permanente has contracted for four megawatts of fuel cell power capacity via the Bloom Electrons service. That capacity will be available to seven different facilities in California. The benefit to Kaiser Permanente will come in energy efficiency: the organization estimates that it will be able to reduce its dependence on electricity generated by fossil fuels by up to 34 percent at the locations where the Bloom Boxes are installed.

The Bloom Box fuel cells use natural gas (which I will take editorial license to mention IS actually based on fossil fuels), but they have the potential to run on 100 percent biogas. In fact, Bloom Energy IS planning to supply the natural gas transmission network associated with its technology with biogas, in order to address this. It has developed a partnership with Southern California Gas Co.

Says Don Orndoff, senior vice president of national facilities services for Kaiser Permanente: “These fuel-cell agreements are a major step toward our goal of including a wide array of sustainable sources in our energy portfolio.”

Here’s what the other companies are doing:

• Walmart is operating two Bloom Box system with 400 kilowatts at two retail locations in Southern California and it will use Bloom Electrons to extend its reliance on the approach.
• Coca-Cola, which already has 500 kilowatts of capacity with Bloom at its Odwalla plant in Dinuba, Calif., will be adding more Bloom Boxes to additional manufacturing facilities. At the Odwalla plant, the Bloom Boxes have enabled the company to use biogas for approximately 30 percent of its electricity needs. Says Rick Frazier, vice president of supply chain for Coca-Cola Refreshments: “Through the Bloom Electrons service, we are able to expand the installations of their Bloom Boxes to additional manufacturing facilities, as part of our commitment to hold worldwide manufacturing carbon emissions flat through 2015 from its 2004 level.”
• Staples has already installed 300 kilowatts of capacity with Bloom Boxes in an Ontario, Calif., distribution center. The new Bloom Electrons will enable the office supply retailer to extend that capability to additional distribution facilities.