Indiana Renewable Energy

Ivy Tech Community College President Tom Snyder penned this editorial in today’s Indianapolis Star about Hoosier manufacturing powerhouse (and CICP member) Cummins – a company has that continued to invest and create jobs in Indiana, while at the same time dominating its global market and generating handsome returns for its shareholders.

Cummins helps power Indiana's economy

It may be a function of Hoosier modesty, or the old adage that admiration and familiarity are strangers, but it often takes an outsider's perspective to remind us about what's truly exceptional in our everyday lives. I was struck by this feeling leafing through Fortune magazine's latest annual Fortune 500 list.

At No. 186 was Cummins, the Columbus-based engine-maker. That's no surprise; Most of us are familiar with Cummins, and have some idea of its size and recent success. We regard Cummins as a valued partner in our effort at Ivy Tech Community College, as well as other organizations I'm involved with, like the Energy Systems Network and Conexus Indiana.

But as I read further, I was amazed by how this Indiana manufacturing stalwart stacks up against its peers.

From 2009 to 2010, Cummins climbed from No. 218 to No. 186 on the list of the nation's 500 biggest companies, boasting more than 22 percent growth in revenues. And that's just the beginning.

Over the past decade, Cummins boasts the best growth in profits of any U.S. company. An automotive manufacturer, outpacing dot-com juggernauts like eBay and Apple, insurance and health-care giants, biotech pioneers. It beats its nearest competitor by more than 10 percent in annual earnings-per-share growth. So it's no surprise that Cummins also represents the second-best investment for shareholders over the past five years.

Clearly, Cummins' growth is due to successive generations of visionary management willing to make aggressive moves. Cummins was a pioneer in exploring overseas markets in the 1960s, and today thrives in places like China, India and Brazil. The company also is on the cutting edge of green technologies: A Cummins engine powered the first diesel-electric hybrid truck in 2005; the company is a leader in putting hybrid busses on our streets, and a partner in the Energy Systems Network initiative to bring new energy innovations to market here in Indiana.

Through it all, Cummins has been unwavering in its commitment to southeastern Indiana. Over the past six years, the company has invested more than $300 million into new facilities and expansions in the region, projects that will account for more than 2,000 jobs.

Manufacturing is leading Indiana's economic recovery. While the nation as a whole suffers through a largely jobless recovery, manufacturing employment in Indiana has grown nearly 5 percent since the end of the recession. Clean technologies and renewable energy offer promising economic opportunities for our state. It's easy to forget that these macro-economic trends are based on the collective efforts of thousands of firms across the state, led by extraordinary businesses like Cummins.

Cummins has been a valued corporate citizen and a steady contributor to our state's economic growth, engaged in critical issues like workforce development. But even so, it sometimes takes a moment like reading the Fortune report to remind us of how fortunate we truly are to count Cummins among our home state headquarters.

In 1919, 40 years after Col. Eli Lilly decided to launch his own medical wholesale company 45 miles north in Indianapolis, a businessman named W.G. Irwin decided to help a self-taught mechanic named Clessie Cummins start his own diesel engine business. Out of such historical footnotes, economies are built -- and Cummins continues to support the vitality of Indiana's economy today.

Snyder is president of Ivy Tech Community College.

First U.S.-China Advanced Vehicle Summit pays off in productive dialogue, new deals between Chinese and Indiana companies

ESN hosts delegation of Chinese officials and auto executives, sharing the state’s expertise in electric vehicle technology development and manufacturing

(INDIANAPOLIS, Ind., May 28, 2010) Nearly 100 Chinese government officials, trade association leaders and auto executives visited Indiana on Thursday and Friday for the first U.S.-China Advanced Technology Vehicle Summit, organized by the Energy Systems Network (ESN) on behalf of Indiana’s leading manufacturers of components and technologies for hybrid electric vehicles.  The event featured several signed deals, substantive dialogue between the two groups, and the promise of more business opportunities for Hoosier companies in the world’s fastest-growing automotive market.

“It’s appropriate that we hold the Advanced Vehicle Summit on the eve of the Indy 500 here in the racing capitol of the world,” noted Joe Loughrey, ESN chairman and retired president of Cummins.  “Indiana is also in a race to attract new jobs and investment in the electric vehicle industry, and this Summit presents us with a historic opportunity.”

Indiana participants in the Summit included Allison Transmission, Cummins, Delphi, EnerDel, and Remy International.  The lengthy list of Chinese companies included BYD, Chery, Dongfeng Electric Vehicle, Shanghai GM, FAW Group, Geely and others.  All of China’s major state-owned, joint venture and private auto manufacturers are producing or have announced plans for hybrid and electric models; the country is projected to grow its global share of the electric vehicle market from 3% to 35% over the next decade.

“This is the largest delegation of Chinese automotive company executives and officials to travel to the United States to visit with American automotive parts manufacturers,” noted Assistant Minister of Commerce Wang Chao. “We are confident the visit will result in stronger business relationships between the Chinese and American automotive companies, especially for hybrid and electric vehicles.”

Assistant Minister Wang Chao’s confidence was shared by Indiana officials, and quickly proved to be well-founded.  On Thursday, Indianapolis-based EnerDel signed a joint venture agreement with Wanxiang Group, the largest auto parts producer in China, to provide advanced lithium-ion battery systems.   The deal between the two Summit participants could more than double EnerDel’s job creation plans for Central Indiana, to 3,000 new green jobs.

“We’re excited about our new partnership with Wanxiang and we look forward to the many other opportunities for collaboration this ESN summit has presented,” said Charles Gassenheimer, Chairman of Ener1, the corporate parent of EnerDel, and a Board member of ESN.  “Meetings like this one set the stage for companies like EnerDel to build new mutually beneficial relationships with Chinese businesses looking west for strategic partners.”

Along with the EnerDel-Wanxiang deal, the China Investment Promotion Agency and the Indiana Economic Development Corporation signed a Memorandum of Understanding to strengthen future trade and economic development opportunities on Friday morning.  Strategic cooperation agreements between Cummins and two Chinese companies, Guangxi Liugong Machinery and Zhengzhou Yutong Group, were also signed. 

Finally, an agreement between the Energy Systems Network, the China Chamber of Commerce for Import and Export of Machinery and Electronics, and the China Association of Automotive Manufacturers set the stage for future meetings.  “We’re pleased to announce that our organizations have agreed to explore another Summit, this time in Beijing, focused on the broader new energy technologies market,” said ESN President Paul Mitchell.

“The Summit is paying off in new jobs and investment,” Mitchell continued.  “These Indiana manufacturers have attracted more than $300 million in federal stimulus grants for advanced batteries and vehicle electrification, and we’re pleased to help them leverage these investments into global business opportunities.”

The U.S.-China Advanced Technology Vehicle Summit was co-presented by the Energy Systems Network, the China Chamber of Commerce for Import and Export of Machinery and Electronics, and the China Association of Automotive Manufacturers.  In addition to presentations by U.S. and Chinese companies during the day-long Summit, events included a welcome dinner hosted by Indiana Governor Mitch Daniels and a Friday evening dinner reception hosted by Indianapolis Mayor Gregory Ballard featuring keynote remarks by David Sandalow, Assistant Secretary for Policy and International Affairs for the U.S. Department of Energy.

The last week has brought positive stories from several areas of the Indiana economy that are represented by CICP initiatives – anecdotal evidence that these industry clusters continue to represent our best prospects for future growth.

Last week, U.S. Department of Energy (DOE) officials traveled to Indianapolis-based EnerDel to meet with company officials and representatives of Central Indiana’s clean technology industry, recognizing our region’s emerging leadership position in vehicle electrification.

EnerDel, the only U.S. manufacturer of advanced lithium-ion batteries for hybrid and plug-in electric vehicles, received a $118.5 million grant from the Department of Energy through the American Recovery and Reinvestment Act (ARRA) in August.  EnerDel and other partners have also joined in a major demonstration project of electric vehicles in the Greater Indianapolis region, dubbed Project Plug-IN, under the auspices of CICP’s Energy Systems Network (ESN) initiative.

The DOE team led by Gil Sperling, Senior Advisor to the Office of Energy Efficiency and Renewable Energy, highlighted both developments, applauding EnerDel’s role in enhancing U.S. innovation and manufacturing capacity in clean energy and recognizing Project Plug-IN as an important initiative that will help make plug-in electric vehicles a practical choice for the American driver.  Indiana’s growing ‘green vehicle’ industry represents a great opportunity for both our energy and advanced manufacturing sectors.

In logistics, s2f Worldwide, a third-party logistics and supply chain service provider, chose to locate its operations in Plainfield this week, a deal projected to create 250 new jobs by 2013.  Central Indiana continues to strengthen our position as a global distribution hub, leveraging our strong infrastructure and inherent geographic advantages into new logistics opportunities.  Our Conexus Indiana initiative is poised to release a comprehensive logistics strategic plan for the state, and is also working to expand intermodal capabilities at the Avon railyard in Hendricks County, putting the region in an even stronger position going forward. 

Indiana continues to rank among the top ten states in logistics employment per capita – these efforts are paying off in good jobs for Hoosiers.

And finally, in technology, I was struck by an interview on Inside Indiana Business with Gerry Dick with Bill Godfrey, Chairman of on-demand marketing software provider Aprimo.  Godfrey asserts that Indiana is becoming a market leader in the e-marketing arena, with companies like ExactTarget, ChaCha, Compendium, Cantaloupe and others joining Aprimo here.  Jim Jay, President of our TechPoint initiative, wrote a piece on this very topic at about this time last year – check it out here.

And speaking of TechPoint, the organization has extended the deadline for its Mira Awards, celebrating Indiana’s high-tech success stories – go here to nominate an Indiana technology innovator today.

Spring is finally right around the corner - to belabor a metaphor, stories like these appearing with greater frequency seem to foreshadow an economic thaw for Indiana to match the warming weather.

The New Year has brought new opportunities for Indiana’s growing green manufacturing sector – the first few weeks of 2010 have seen several announcements that, collectively, show the momentum behind Hoosier manufacturing’s effort to electrify vehicles, make renewable energy sources a practical reality and more.

First, there was the news that Think North America had chosen Elkhart as the site of its first U.S. factory for its line of electric cars, joining Electric Motors Corp and NaviStar as the hub of a growing green vehicle cluster along Indiana’s northern border.

In Central Indiana, EnerDel – the only U.S. manufacturer of the cutting-edge lithium ion batteries that power hybrid and plug-in electric vehicles – announced a major manufacturing facility in Greenfield, Indiana, expanding a footprint that already includes its northeast Indianapolis headquarters and facilities in Hamilton County.  The Greenfield site will ultimately employ nearly 1,100.

Elsewhere, Brevini Wind (in Muncie) has earned $12.8 million in federal tax credits for its work manufacturing the gear boxes and other technologies for the turbines that generate electricity from wind.  Just two weeks ago, Secretary of Energy Chu visited Columbus to announce $54 million in federal stimulus grants to Cummins to increase engine efficiency.

Just like any technology-intensive, innovation-driven industry, a skilled workforce is a critical need for green manufacturing.  Here too, Indiana is moving forward – the state’s Department of Workforce Development recently earned a $6 million grant from the U.S. Department of Labor to create new curricula and retrain industrial workers from other sectors to take advantage of new green job opportunities.

Look for more announcements ahead from Indiana’s green manufacturing and clean technologies industries, as well as CICP’s Energy Systems Network initiative, as the state continues to solidify its position as a crossroads of energy innovation. 

Let’s end the week with some positive news for our state’s economy, as a new study from the Pew Charitable Trusts documents an 18% increase in Indiana clean technology jobs over the last decade.

Cleantech is a booming industry that’s seeing dramatic growth and attracting significant new investment, based in part on ambitious federal goals that include doubling renewable energy use within three years and putting a million new hybrid vehicles on U.S. highways.  The cleantech sector saw more than $7.7 billion in venture capital investment in 2008; especially impressive considering that cleantech venture capital made up just 1% of total VC financing in 2004 (the first year it was widely tracked).  The 2008 figures represent 20% of last year’s venture investment.

According to the U.S. Energy Information Administration, overall market demand for alternative energy and related products and technologies will continue to grow at a rapid pace for the foreseeable future.  The EIA projects 3.3% annual growth in renewable energy consumption through 2030, as well as a sharp increase in light-use hybrid vehicle sales from just 2% of the current market to 38% in 2030.  (Industry experts estimate that nearly 500,000 new hybrid vehicles will hit U.S. highways in 2009 alone.)

Other EIA analysis of cleantech sub-sectors like wind and solar power, plug-in/hybrid electric vehicles, second generation biofuels, distributed power generation, and systems integration project each to grow to more than $70 billion over the next ten years, collectively accounting for a more than $350B global market.

Look for more news on cleantech and Indiana’s emerging leadership position from CICP’s new Energy Systems Network initiative. 

Yesterday marked the public launch of an initiative that CICP has been working on for nearly two years (along with the Governor’s Office, our Conexus initiative, and support from organizations like the Rocky Mountain Institute) – the Energy Systems Network, a bold effort to make Indiana a global hub for ‘clean technologies’ and energy innovation.

The energy industry today faces tremendous challenges – and the cleantech sector has the potential for explosive growth as it provides the solutions. Indeed, cleantech sub-sectors like wind and solar power, plug-in/hybrid electric vehicles, second generation biofuels, distributed power generation, and systems integration are each projected to grow to more than $70 billion over the next ten years, collectively accounting for a more than $350B global market.

And there’s certainly a sense of urgency: The Obama administration has pledged to double renewable energy use within three years and put a million hybrid electric vehicles on our highways by 2015.  A growing share of the public, concerned about the environment, dependence on foreign oil and other issues, is fueling market demand for clean energy products.  And the inevitability of federal climate change legislation means technological breakthroughs in energy will be critical to curb huge potential price increases for carbon-based power for businesses and families.

Indiana has a unique opportunity to seize a leadership position on the cutting edge of this green revolution.  More than twenty years ago, GM and others engineered the first electric vehicle (the EV1) here – today, we’re home to firms working on nearly every key component of hybrid and plug-in vehicles, from engines and transmissions to advanced batteries.  We’re leaders in biofuels, clean coal technology, and benefit from the presence of innovative utility partners (like Duke Energy) focused on the development of ‘smart grid’ technologies that will help consumers better control their power use and supply.

In short, all of the assets are in place – and now we have another competitive advantage: The collaborative spirit embodied by the ESN.  This initiative recognizes that no single company has the solutions to the energy challenges that we face – companies and research institutions must work together to bring these solutions to market.  And of course, it’s our preference that these partnerships begin in Indiana and that we capture as much of the economic benefit as possible for Hoosiers.

The ESN is led by an all-star Board of Directors and is being ably managed at the staff level by Paul Mitchell, former policy advisor to Governor Daniels.  The Network already has two exciting projects in its commercialization pipeline: The Hoosier Heavy Hybrid Partnership is focused on bringing more cost effective light, medium, and heavy duty  hybrid trucks to market.  Project Plug-IN will integrate plug-in electric vehicles and ‘smart grid’ technologies providing a green transportation solution for Central Indiana commuters in one of the nation’s first large-scale pilot projects.

I’d encourage you to visit the landing page we set up for the ESN launch to learn more about this new addition to the CICP family – you’ll be hearing much more from the ESN in the weeks and months to come.