No one needs to be convinced that giving back to the community is important. For companies, while it’s a smart business move to give back—doing so improves corporate culture and company morale—it’s also just the right thing to do.
Natural gas utilities are particularly embedded in their communities, with employees and corporate foundations alike giving time and donating funds to support a wide variety of community needs. But some utilities have gone beyond even this to make a strong commitment to supporting local communities in need: In essence, they’ve thrown out a life preserver, rescuing towns and cities from blight, building relationships and, as a result, improving the lives of local families.
Shortly after the Great Recession, Gerry Anderson, executive chairman of DTE Energy, was speaking to an assembly of employees when an epiphany came, inspired by one of the questions posed in a Q&A.
Employees were celebrating the fact that the utility had come through the recession with no layoffs, thanks to belt-tightening and hard work. Then, an employee raised a hand to speak. She said, “What we did was incredible, and everybody is feeling great. But our neighbors are still suffering. What are we going to do to help them?”
Anderson took her question seriously, recalled Nancy Moody, vice president of public affairs for DTE Energy. It led to what the company now refers to as its “Force for Growth” work. Instead of solely focusing on half of the company’s aspiration, “to be the best operated energy company in North America,” DTE is also living the second half of its aspiration, “to be a force for growth and prosperity in the communities where employees live and serve.”
Since that pivotal question, Force for Growth has lived up to its name. For instance, in 2016, the Randolph Career Technical Center, a skilled-trades school in Detroit, had seen better days. “It had dwindled from 700 students to around 90,” Moody recalled. “Meanwhile, this was at a time when the city was turning around. We needed all these skills-trained workers, and we couldn’t find them.”
So, in a win-win situation, DTE worked with the mayor’s office, the Detroit public schools, its unions and other corporate partners to raise $10 million (with the first million donated by DTE) and rebuild the school. Today, the school has 300 day students and another 300 evening adult students attending.
DTE also found another way to help. Michigan has some of the highest auto insurance rates in the country, due to the fact that it was the only state in the nation that required unlimited medical coverage in auto insurance policies, which pushed rates higher. As Dave Meador, vice chairman and chief administrative officer at DTE, told Crain’s Detroit Business in 2017: “It has all kinds of implications, from people not buying cars, to people using suburban addresses to avoid the high rates, to people driving without insurance, which impacts all of us.”
So, DTE had people like Meador lobbying the state to get the law changed. That change happened this year, although rates aren’t expected to come down for at least another year.
Then there’s the commitment DTE Energy made to reduce its carbon emissions by more than 80 percent by 2040, mostly by closing its coal-fired electric generation plants and replacing that generation with renewables and a natural gas combinedcycle plant. It has also been working on another commitment—to reduce methane by more than 80 percent by 2040.
But one of the places where DTE has very obviously been transforming its local community is just outside its Detroit headquarters at Beacon Park. One day Anderson was looking out his office window at a part of the city with a gravel parking lot, a dilapidated industrial building and an ugly barbed wire fence around them. He kept looking and finally thought, “We need to get rid of that.”
DTE ended up buying the land, razing the building and tearing down the fence. Anderson continued to look out his window and think, “We can do better than that.”
One day, during a work-related trip to Boston, he walked through a beautiful little park and thought, “Ah-ha.” He sent his office photos of the park, and DTE went to work. The end result was Beacon Park, a 1.5-acre green space with a restaurant and a large lawn that lends itself to concerts, sports league activities, community activities and hundreds of ongoing events every year. And as another result of the utility’s initiative, the entire area around Beacon Park is being revitalized.
“We’ve had a million visitors to the park since July 2017,” Moody said. “Over $140 million of investment have been announced for the immediate area, and we know there will be more to come. We think Beacon Park is living up to its name as a beacon to attract visitors, investment and hope in our part of west central downtown Detroit.”
The story doesn’t stop there. DTE has multiple initiatives across five pillars of its Force for Growth work, and Anderson has led the development of a Regional CEO Group that is partnering on many of those initiatives. Its strongest achievement to date is the creation and development of a new regional economic development organization, the Detroit Regional Partnership, dedicated to growing existing businesses and attracting new business with an eye toward equitable creation of jobs for all residents of southeast Michigan.
Baltimore Gas and Electric has long made supporting its diverse local community a priority.
In 2009, BGE began a larger push toward making sure its suppliers included minority-owned, female-owned and veteran-owned businesses. The goal was to hit 25 percent.
As a result, BGE launched its Focus 25 supplier development program, which was designed to help diversity-certified businesses compete for contracts. As Robert Matthews, director of talent management and talent acquisition, explained, “It’s a months-long process, a cohort experience. You learn what it takes to get contracts with large corporations that might have more exacting standards than smaller companies.”
And it has been working. Almost 10 years after the program started, BGE bought $326 million in goods and services from diversity-certified suppliers in 2018—representing 35 percent of the company’s total purchases.
A pivotal moment came in 2015. That April, Baltimore fell into a period of civil unrest, with street protests that turned violent. Afterward, “there was a more keen awareness of what was happening in our city, a city that we love. So, the events didn’t necessarily inform what we would do, but it did definitely create a greater awareness about the importance of what we were doing,” Matthews said.
That’s when BGE began looking at how it could create more opportunities for young people in the city. It posited that, while an initiative might not smooth over the rough relationship some people have with local police, which was the flashpoint for the unrest, more job opportunities could provide some balm to a city that was hurting.
“We started looking at workforce development more closely,” Matthews said. “In other words, we started thinking, ‘What’s the largest point of entry into our organization?’ And that would be our entry-level field mechanic jobs. So, then we started asking ourselves, ‘What are the pipelines for those roles, and how do these pipelines reach the various parts of the city?’”
BGE focused initially on vocational and technical schools and ultimately created the Smart Energy Workforce Development Program. In a nutshell, BGE now works closely with four Baltimore city Career Technology Education schools to help prepare students for careers with companies like BGE. In 2017, BGE hired three students from those schools into full-time positions with benefits. In 2018, another seven were hired. At press time, the hiring decisions hadn’t been made for 2019.
But even if graduates aren’t ultimately hired for full-time work at BGE, all indicators suggest that the utility is making a powerful difference for some youth in Baltimore. Matthews remembers one moment in particular.
“At the end of the summer, the interns were leaving, and we had our final session, asking if there were any questions or concerns,” he said. “One intern stood up and asked, ‘Would it be OK if I kept my ID badge?’”
His fellow interns laughed, and Matthews explained that the teen would have to give up the badge because of security requirements. Then Matthews asked why he wanted to keep it.
“I’ve been in a lot of places where I didn’t feel like I belonged. But here, it was different,” the intern said. “I was in meetings, and they asked for my opinion. They looked for answers from me. They expected me to participate. I can now look at a person and introduce myself as an intern at BGE. This badge is a symbol that I belong.”
These types of community initiatives strike a chord with so many. So, it can be easy to overlook the fact that exciting work is often going on in industrial parks around the country, work that provides jobs. Those industrial parks also help a community’s tax base and lead to other businesses popping up to support them.
This is why Alliant Energy, a public utility holding company headquartered in Madison, Wisconsin, that serves Wisconsin and Iowa, has made it its mission lately to buy up acres of unused land and get them certified and zoned for development.
To date, the utility has accomplished this at four sites in Iowa and Wisconsin, with 11 other community-developed industrial parks being promoted and marketed by Alliant. Two recent crown jewels are Beaver Dam Commerce Park, a 520-acre future industrial park that will allow the city of Beaver Dam, Wisconsin, to attract more business; and Big Cedar Industrial Center in Cedar Rapids, Iowa, which has 1,391 acres under option control.
These are big deals. While land isn’t that hard to come by in the two farming states, if you’re a corporate giant, it’s necessary to find locations that are ready for a business to move into with sewer, water, electric and gas hookups. It’s also necessary to locate near railroads and other transportation hubs.
In this case, Alliant Energy has done all of that work.
It was kind of a no-brainer, in a way, according to Scott Drzycimski, the Iowa director of customer and economic development for Alliant Energy. “Alliant Energy covers a heavily rural territory. We do have some larger cities, but the vast majority of our territory is smaller, rural communities. In Iowa, more than 450 communities have fewer than 1,000 people,” he said.
For a number of reasons, these areas are not seeing natural growth, not in the way some parts of the country have, according to Drzycimski. “A lot of our communities are getting smaller, and so we want to make sure they can be maintained and grow,” he said.
Like the industrial parks themselves, the process of putting the projects together isn’t glamorous. It takes time, and there have been setbacks. For example, Alliant Energy courted Mazda-Toyota, hoping to entice it to build a $1.6 billion car manufacturing plant at Big Cedar Industrial Center. That would have led to 4,000 new jobs. But Mazda-Toyota ultimately passed.
“We learned a lot from that,” Drzycimski said. First was the fact that the Mazda-Toyota types of projects come by “every once in a while,” but there are many more medium-sized companies that need places to locate. As a result, Drzycimski said that while Alliant has been marketing Big Cedar as a “mega” site, the office park can also be parceled up to become a neighborhood of smaller companies.
Drzycimski said that Alliant has also changed its marketing focus in another way. “We recognize you can’t go and just cover the entire marketplace. You have to be focused. We don’t have a big automotive industry in Iowa. We do grow a lot of corn and soybeans.” So, Alliant is focused on reaching companies, for instance, that make plastic out of bioproducts.
Still, there was a silver lining to the failed Mazda-Toyota contract: Because of the attention the center received during the courting process, more prospective tenants have been reaching out to the utility.
“This is not a short-term play,” Drzycimski said. “We recognized from the day we started we would be in this for the long-term, that it would take a few years to find the land, a few years to build. We’re putting the time in now to get the return later.”