Heavy Industry Goes Renewable

This case study examines a virtual power purchase agreement (VPPA) signed in August 2017 between Cummins, a global industrial manufacturer, and EDP Renewables (EDPR) North America. The deal focuses on expanding wind capacity in Indiana to help Cummins meet its corporate sustainability and greenhouse gas reduction goals.

• In August 2017, Cummins signed a 15-year virtual power purchase agreement (VPPA) with EDP Renewables (EDPR) North America for 75 megawatts (MW) of wind capacity. This capacity is sufficient to power approximately 20,000 homes and represents about 50 percent of Cummins' US energy usage and 28 percent of its global usage.
• The VPPA is designed to expand an existing 600 MW wind farm, known as the Meadow Lake Wind Farm, located in Benton and White Counties, Indiana. Once the project becomes operational around January 1, 2019, it is expected to avoid 165,000 tons of CO2 equivalent (tCO2e) per year.
• Cummins utilized a VPPA because it offered a more cost-effective and scalable solution than on-site renewables; the company calculated that achieving the same 75 MW of capacity via on-site solar would require one square mile of panels and cost approximately $380 million. The VPPA requires no up-front costs beyond transaction costs and serves as a partial hedge against market prices.
• To secure internal approval and mitigate financial risk, Cummins engaged Schneider Electric as a buyer's advisor, joined the Business Renewables Center (BRC), and performed Monte Carlo simulations on historical price data. The company's decision-making was guided by principles of cost-competitiveness, transparency, and 'additionality'—ensuring the deal added new renewable capacity to the grid.

APA

RMI (2018). Heavy Industry Goes Renewable. https://rmi.org/resources/heavy-industry-goes-renewable/

Chicago

RMI. Heavy Industry Goes Renewable. 2018. https://rmi.org/resources/heavy-industry-goes-renewable/.

Wikipedia

{{cite report |author=RMI |title=Heavy Industry Goes Renewable |date=3 October 2018 |url=https://rmi.org/resources/heavy-industry-goes-renewable/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2018heavy, author = {{RMI}}, title = {{Heavy Industry Goes Renewable}}, institution = {RMI}, year = {2018}, month = oct, url = {https://rmi.org/resources/heavy-industry-goes-renewable/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }