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Smithfield reaches wind power agreement

Agreement will help company meet its greenhouse gas reduction and renewable energy goals.

Smithfield Foods Inc. has reached a power sales agreement with Allete Clean Energy, a subsidiary of Allete Inc., for the remaining output of the Diamond Spring wind site Allete Clean Energy will build, own and operate in Oklahoma. Smithfield will purchase 75 megawatts for 12 years.

The Smithfield agreement follows an earlier announcement of power sale agreements with Walmart and Starbucks wherein Walmart agreed to purchase 175 megawatts for 15 years and Starbucks will purchase 50 megawatts for 15 years. The approximately 300-megawatt Diamond Spring site, which is Allete Clean Energy’s first project to sell wind power to corporate customers, is now fully contracted with the Smithfield agreement.

"Allete Clean Energy is proud to help these leading companies meet their greenhouse gas reduction and renewable energy goals through the carbon-free energy that will be generated at Diamond Spring,” Allete Clean Energy president Allan S. Rudeck Jr. said. "In addition to adding renewable energy to meet sustainability goals, these companies also seek to lower their energy costs. Our team delivers both, with a reputation for timely, responsible and cost-effective project execution. Directly serving the corporate and industrial power market is opening new growth opportunities for Allete Clean Energy.”

Diamond Spring will be Allete Clean Energy’s largest wind site when operations begin in 2020. Construction will begin late this year or in early 2020. Diamond Spring will produce enough power for 114,000 homes and increase the company’s total wind capacity to more than 1,000 megawatts at nine sites in seven states.

Smithfield announced a goal in 2016 to reduce greenhouse gas emissions 25% by 2025. To help reach that goal, it created Smithfield Renewables, a platform that unifies and accelerates the company’s carbon reduction and renewable energy efforts.

"This partnership to source renewable energy is part of our multifaceted and comprehensive approach to reduce our carbon footprint,” said Kraig Westerbeek, senior director of Smithfield Renewables and hog production environmental affairs at Smithfield. "The carbon-free energy generated through the Diamond Spring project is projected to account for more than 15% of our total energy usage across the United States, allowing us to power a substantial portion of our operations using sustainable energy.”

Walmart has committed to covering 50% of its energy needs with renewable sources by 2025 as it works toward an ultimate goal of operating with 100% renewable energy.

"Walmart aspires to be supplied by 100% renewable energy, and sourcing from wind energy projects — like the Diamond Spring wind facility — is a core component in the mix,” said Mark Vanderhelm, vice president of Energy for Walmart Inc. "The energy we'll procure from this facility represents an important leap forward on our renewable energy journey and reinforces Walmart’s broader mission to spark collective action — alongside key partners — to drive environmental sustainability.”

Allete Clean Energy acquires, develops and operates clean and renewable energy projects. It currently owns and operates approximately 555 megawatts of nameplate capacity wind energy generation in four states that is contracted under power sales agreements of various durations. The company has another 489 megawatts of new wind projects under construction in three states under long term power sales agreements. Allete Clean Energy also engages in the development of wind energy facilities to operate under long-term agreements or for sale to others upon completion.

Allete Inc. is an energy company headquartered in Duluth, Minn. In addition to its electric utilities -- Minnesota Power and Superior Water, Light & Power of Wisconsin -- Allete owns Allete Clean Energy based in Duluth and BNI Energy in Bismarck, N.D., and has an 8% equity interest in the American Transmission Co.

TAGS: Business
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