The U.S. Army is Going Green to Save Money and Lives

Photo credit: Flickr/U.S. Army.

The U.S. Army is going green. No, it's not getting new uniforms again. Instead, it has now awarded the third of four contracts focused on renewable energy technology. The $7 billion spending plan is for the purchase of energy over a period of 30 years from renewable energy plants. These plants would be constructed and operated by private sector companies.

In April of 2012 the U.S. Government made one of the largest commitments to clean energy in history. It announced a bold goal to deploy three gigawatts of total renewable energy on U.S. military installations by 2025. To put that size into perspective, that's enough energy to power about three million homes.

The U.S. Army is under Congressional mandate to meet a goal to have 25% of its energy production and consumption come from renewable sources by 2025. It's part of the overall plan to improve energy security and sustainability. In order to meet that goal, the Army has devised a plan to use mix of solar, wind, geothermal and biomass as part of its $7 billion spend to go green.

So far the contracts for geothermal, wind and solar have been awarded. Several public companies including major utilities Duke Energy (NYSE: DUK  ) and Dominion Resources (NYSE: D  ) as well as solar panel maker Sunpower (NASDAQ: SPWR  ) were among those recently awarded contracts. While these contracts are likely to be small and lower-margin and not likely to be needle moving for big utilities like Duke and Dominion, it does open up the door for future contracts. The Department of Defense is the biggest single energy consumer in the world at $20 billion each year. Meaning, there are plenty of opportunities to fuel the U.S. military machine in the future.

While the Army is currently splitting its funds up into the three technologies, solar could be the big long-term winner. In addition to utility scale projects on military installations, solar is already proving to be useful in the battle field. For example, the Army has used solar at remote bases in Afghanistan, which significantly cut down on the amount of liquid fuel it uses for generators. That is why interested investors should keep a close eye on Sunpower and other solar manufacturers as these companies could really benefit from long-term demand from the military.

While many will surely criticize the military's plans to spend so much money on green technologies, let's face it, this really is a drop in the bucket compared to its annual spend of $20 billion. We are talking about trying to offset some of the nearly 5 billion gallons of oil that it consumed last year. To put that into perspective, that's nearly 120 million barrels of oil and for a country that imports about 7.4 million barrels per day, and it represents 16 days' worth of oil imports which is a pretty significant amount of oil. Cutting costs by switching using more renewable energy is really a smart move. 

The other important factor in all of this is saving lives. For example, in 2010 alone there there 1,100 attacks on fuel resupply convoys. Sadly, attacks like these cost lives. In fact, during 2003 to 2007 we lost 3,000 soldiers and contractors on refueling missions alone in Iraq. It's really quite simple, by using less fuel on the battlefield we can save more American lives. 

If America is ever going to get serious about our own energy security, renewables need to be part of the picture. The best place to start is with those in charge of our national security, which is why it makes a great deal of sense for the U.S. Army to start pushing for more renewable power. If we ever want to become OPEC's worst nightmare, we need to stop being its best customer.

While renewables need to be part of the equation, we also need to increase our own production of oil. That's why I want to introduce to you a company that just might hold the key to more oil. First, imagine a company that rents a very specific and valuable piece of machinery for $41,000... per hour (that's almost as much as the average American makes in a year!). And Warren Buffett is so confident in this company's can't-live-without-it business model, he just loaded up on 2.19 million shares. An exclusive, brand-new Motley Fool report reveals the company we're calling OPEC's Worst Nightmare. Just click HERE to uncover the name of this industry-leading stock... and join Buffett in his quest for a veritable LANDSLIDE of profits!


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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 15, 2013, at 10:08 AM, euzkara wrote:

    When an investment advisory firm puts out a ridiculous article such as this, it seriously damages its own credibility as a source of sound financial information. Bio fuels, solar panels and windmills will never be as economically efficient as hydrocarbons as even a cursory understanding of the 2nd Law of Thermodynamics will tell you. Some bio fuels now being used by the military cost as much as $400 per gallon. This diverts defense spending from armaments to utterly wasteful pet projects of politicians. Ethanol is another example of such wasteful and costly government regulation mandated to please corn state politicians and their agribusiness funders. Secondly the US has plenty of its own oil and gas underground and off shore and could export the stuff instead of importing it if the Obama Administration would allow American companies to drill for oil where they know it exists. As to saving lives, just how exactly will requiring our military vehicles to use bio fuels result in saving lives as that stuff has to be transported as well?

  • Report this Comment On September 15, 2013, at 10:36 AM, bluemoon51 wrote:

    Using solar in Afghanistan (and other Middle East areas of conflict) makes sense but the rest of the article is nonsense. More chasing the renewable rainbow efforts from the current administration. The movement was started with "energy independence" but had to change with all of the new technology to extract oil and gas. "Global warming" had to be changed to "climate change". Now the writer has come up with "saving lives". Good grief. I have followed some of the previous articles by this author and they were good investment pieces. I will forget this one!

  • Report this Comment On September 15, 2013, at 10:37 AM, fullofools wrote:

    "Some bio fuels now being used by the military cost as much as $400 per gallon. "

    Name one. Oh you cannot. There is no bio fuel that cost 400 per gallon unless it actually costs 400 dollars per gallon for the non bio fuel.

    Windmills for instance in Spain produce more power then 11 nuclear reactors and the windmill network cost a fraction of the cost of the nuclear reactors plus no nuclear materials needed to produce the power.

    Also guess what you have clue what the 2nd law is. Solar power produces more energy then burning fossil fuels. This is because burning fossil fuels at most only releases a fraction of the potential energy. Solar energy conversion right now is at 40% much higher then fossil fuel to electricity production.

    The US already exports a huge fraction of oil and natural gas. More oil and natural gas is being drilled for then under Bush. Guess what the supply has nothing to do with the cost. When you take into account inflation the cost of a gallon of gas is the same as it was in 1910 when most cars were electric/steam and gasoline powered cars were in the minority.

    Obviously you think solar powered flashlights are a huge waste of money. Guess what the military loves them because they get recharged during the day and the soldiers don't have to lug around 15 pounds of batteries.

    Ethanol also can be made from other things besides corn. Poplar for instance, High energy output low energy yield.

    Do some actual fact checking rather then cite debunked garbage.

  • Report this Comment On September 15, 2013, at 11:11 AM, webjockey wrote:

    This is an entire waste of money from the standpoint that we won't have much of a military by 2025. No nation with massive entitlement programs and national health care can afford more than a few ships and planes (see Europe, Australia, New Zealand).

  • Report this Comment On September 15, 2013, at 11:36 AM, fishhead001 wrote:

    The $400 fuel is bio jet fuel, JP??? and yes it exists. Solar isn't cost effective yet, neither is ethanol, wind, etc. Biomass is and combined cycle plants can run at up to 50+% efficiency. The government is doing the "green" thing because they aren't required to choose the cost effective option. And yes, I DO understand the 2nd law of thermo, very well thank you. Its a requirement for a mechanical engineering degree. If green energy was cost effective, private companies would be installing it without government mandates. Please note that a lot of european countries are slowing moving away from solar and wind because people have found out what other people in the world pay for power and they are pissed out the prices they pay. Green energy still costs about twice the price of fossil fuels. Don;t be fooled by the pump prices for ethanol, its subsidized by our government. The real cost is much higher.

  • Report this Comment On September 15, 2013, at 11:53 AM, NOTvuffett wrote:

    @foolofools

    There is so much wrong with what you are saying I don't even know where to start. Perhaps the $400 figure is out of line, but this is probably the actual cost when they are buying fuel from a pilot plant. In any case, it turns out to be way more expensive than a petroleum based fuel. The fuel used for jets is similar to kerosene.

    Having a bunch of windmills has really supercharged the Spanish economy, lol.

    What planet are you from? Commercial solar cells are not 40% efficient. The last time I checked, it was dark for half of the day.

    There is only one active LNG exporting facility in the US, and that is in Alaska. So how can you say that the US is exporting lots of oil and gas? Canada and Mexico are our largest suppliers of these things.

    Every careful analysis of corn based ethanol has shown little to no gain in energy production. It is possible to make ethanol from materials high in cellulose, but so far there are no economically viable ones. When somebody can make money on this, it will exist.

  • Report this Comment On September 15, 2013, at 12:24 PM, flemdan1 wrote:

    If it has to be subsidized, it's because it is not economically feasible. As with all green innitiatives, it must be forced upon the citizens by the government. Corruption between the politicians and their green supporters is rampant, and the taxpayers are the victoms. Green will never be popular or cost efficient until the fossil fuels run out, and huge new reserves of oil and gas are discovered every day.

  • Report this Comment On September 15, 2013, at 12:44 PM, calpwrguy wrote:

    What the article doesn't state is that these contracts (called MATOCs) are actually unfunded "hunting license" contracts. Future contract task orders still have to be funded and each contract awardee still has to compete for an actual award task order using the master MATOC "hunting license" contract. And.. in many cases, the awarded task order has to be priced at less than current market (coal, natural gas) based power costs to the government.

    The notion that contract's total awards will be up to $7B is far fetched and it is misleading as to the real potential future revenue and margins to the contract awardees.

  • Report this Comment On September 15, 2013, at 12:52 PM, TMFmd19 wrote:

    @bluemoon51 - Actually, a bit of background on the saving lives part...my dad is retired from the army and when I asked him why the army is going green his first response was to save lives. Just look at the number of refueling convoy attacks on the battlefield. Reducing the fuel needs of the military on the battle field would save lives. It was a point I didn't think should be overlooked. Thanks for reading.

    Matt

  • Report this Comment On September 15, 2013, at 1:19 PM, borispastrynak wrote:

    I got a better idea... get out of Afghanistan, Iraq, North Africa, Syria, the Middle East .. talk about saving money .. so far the real cost to the US of these non stop wars of choice.. aka regime change is over a trillion dollars .. $1, 496. TRILLION and change. Green energy .. that is arguing how many angels on the head of a pin. Analysts say by 2025 the cost of wars and military and taking care of wounded or retired vets is going to be about FOUR trillion bucks. Green energy .. in the scheme of things that is a flea on an elephant and meant to distract from the real issues.

  • Report this Comment On September 15, 2013, at 1:54 PM, shyhalu wrote:

    "If it has to be subsidized, it's because it is not economically feasible. As with all green innitiatives,"

    Um.....oil companies get subsidies....lots of them.

    When you defeat your own argument...its time to step back and use some critical thought.

  • Report this Comment On September 15, 2013, at 2:44 PM, NOTvuffett wrote:

    "Um.....oil companies get subsidies....lots of them."

    I am so tired of this bs. Oil companies get tax breaks for making capital investments, just like any other kind of company.

  • Report this Comment On September 15, 2013, at 6:32 PM, phillipzx3 wrote:

    " Bio fuels, solar panels and windmills will never be as economically efficient as hydrocarbons as even a cursory understanding of the 2nd Law of Thermodynamics will tell you"

    Not true. Solar and wind are already more economically efficient, they just don't have the production scale. Electric motors are more efficient by three times or more than the internal combustion engine. The problem is energy density...gasoline rules in that respect...if you don't mind tossing 75 cents of each dollar you spend out the window. ICE are only about 25% efficient. So much for your "economic efficiency."

    I have 10KW worth of solar panels on my house. In 3 more years, they'll have paid for themselves, which will make them 100% more "economically efficient" (as you put it) than ANY form of hydrocarbon.

    Once a gallon of gas, oil or a unit of natural gas is burned, it's gone...FOREVER. My solar panels (as with wind turbines) will keep on producing power without the need to buy any more fuel. They'll keep doing this for another 20 years.

    Solar is free. Wind is free. The geothermal energy in the Earth is free. All we need to build is the hardware to do the conversion.

    BTW, hydroelectric dams put oil, NG, coal and nuclear power to shame, if economic efficient is of concern.

    Scientific American (April of 2013 if memory serves) did an article of the true cost of our energy. Find a copy and read what it really costs (Well to wheel, so to speak) of these "economically efficient" hydrocarbons you speak of.

  • Report this Comment On September 15, 2013, at 6:36 PM, phillipzx3 wrote:

    "I am so tired of this bs. Oil companies get tax breaks for making capital investments, just like any other kind of company. "

    It goes way beyond capitol investments.

  • Report this Comment On September 15, 2013, at 7:26 PM, jferristx wrote:

    Please read the article again. Those stating we should develop our oil here because we have lots of it....that has NOTHING to do with our military stationed in other parts of the world. Moving fuel to a remote location is called a logistics line, and it is the weakest point of an army. So, this is about saving lives, NOT oil. Oil companies just get the same tax breaks for capital investments. Yes...and ones for faster depreciation, deductions on land leases (still getting leases at less than a dollar per acre for oil, coal, and gas, and that is a minute fraction of what they take out of the lease). And they usually have no liability for spills, re: the Tenn coal tailings pond that broke and ruined several communities. As for solar and cost, UNsubsidized solar is still less expensive than nuclear (which has ALWAYS been subsidized), it is nearly equal in cost to coal, and is approaching oil. Most of all, it is a reality on the small level that MUST be considered because as utility companies lose customers who go solar with grid tie, they lose income for infrastructure. And that raises utility costs, which increases investment in solar. This is supposed to be an INVESTMENT blog, not a political one. Will those with a political agenda please leave and those who are interested in investment opportunity please speak up?

  • Report this Comment On September 15, 2013, at 7:30 PM, jferristx wrote:

    *Please correct my post to no liability for EXTERNALIZED costs, such as the tailings pond failure, particulate air pollution, water pollution (such as all drinking water in Texas now has MTBE in it) and the externalize cost of needing a huge military to protect our investments and shipping lanes for oil. Add those costs to fossil fuels, and solar is more then competative.

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