FORT WAYNE – Protecting the environment is paying off handsomely for GM.
General Motors Co. is investing about $11 million to build a power station that uses four engines to convert landfill gas into electricity for its Allen County truck assembly plant, company officials announced Wednesday.
Energy savings of almost $5 million a year will offset the investment in less than three years, officials said. After that, the savings will pad the company's profit margin.
"People ask all the time, 'Why do you do all this environmental stuff?' " spokeswoman Stephanie Jentgen said. "It just makes good business sense."
The local plant, which assembles Chevrolet Silverado and GMC Sierra pickups, will be able to generate 6.4 megawatts of electricity from landfill gas, a renewable energy source.
Estimates call for the Allen County operation to reduce its annual carbon dioxide emissions by about 39,000 metric tons. Carbon dioxide – or CO2 – emissions contribute to global warming.
The effort is part of a two-plant, $24 million pilot project that includes the Lake Orion Assembly Plant in Michigan, where GM assembles the Buick Verano and the Chevy Sonic. Work has already begun in both locations and is scheduled to be completed in May.
GM is the first automaker in North America to harness landfill gas to power its plants, Jentgen said.
Combined, the project will eliminate about 89,000 metric tons of CO2 – roughly equal to the emissions of 18,500 passenger vehicles, GM said in a news release.
United REMC, which supplies electricity to the local plant, fully supports the energy-generating project, CEO Rob Pearson said. He attended Wednesday's announcement.
"We worked closely with GM to provide the proper infrastructure and rates to help GM help the environment, save money and move forward with new technology," Pearson said in a statement.
The Fort Wayne region's electrical demand is projected to increase by 20 percent over the next 20 years, Jentgen said.
By becoming more energy independent, GM is freeing up power that United REMC can divert to serve other customers.
If the automaker didn't reduce its reliance on the utility, United REMC would probably need to invest in new infrastructure – spending that could drive up residential electricity rates. As a result, Jentgen said, local homeowners will also benefit from GM's investment.
GM officials laid the groundwork for the upgrade in the summer when it replaced the 9-mile pipe that connects the assembly plant to the Smith Road landfill. The new 12-inch-diameter pipe increased capacity by 125 percent over the previous 8-inch pipe, Jentgen said.
The closed-loop system keeps the unpleasant odor of methane gas contained.
"You absolutely can't smell it," she said.
The latest project expands the local GM plant's reliance on landfill gas, which has been supplying steam to its boilers since 2002.
The latest investment will increase the plant's reliance on landfill-derived energy by four-fold, Jentgen said.
The plant, which employs about 4,000 hourly and salaried workers on three shifts, will pull 40 percent of its total energy from landfill gas after the project is completed.
Wednesday's announcement is just the latest in a series of environmental initiatives GM has taken at its local facility.
In 2011, GM announced that its Allen County assembly plant had become landfill-free – the company's first U.S. plant that generated zero garbage. Instead, staffers find ways to reduce, reuse and recycle waste created in the production process.
Efforts include soaking up spilled motor oil with reusable pads, which are spun in an industrial drum to extract the oil so it can be reused.
Mike Glinski, plant manager, said at the time that it was one of the most significant achievements in the plant's 25-year history.
The company had about 80 landfill-free facilities worldwide as of October 2012.
Because of a reporter's error, a story on Page 1A Thursday and an earlier version of this story online included an incorrect number of engines.