Siemens Consortium Gets Right to Bid for $7 Billion Army Deals

A consortium of Siemens AG (SIE), Bechtel Group Inc. and AECOM Technology Corp. (ACM) won permission to bid for $7 billion in contracts to build renewable energy installations for the U.S. Army that could span a decade.

The group has the right to bid for contracts in geothermal, solar, wind and biomass technologies projects, Munich-based Siemens said in a statement. After an initial three-year period, the contracts could be renewed on an annual basis for up to seven years.

The Siemens-led consortium will help “accomplish the Army’s goals of increasing their use of renewable energy, enhancing infrastructure resilience and energy security, while decresing energy costs,” Judy Marks, the head of Siemens’s government technologies division, said in the statement.

Siemens has increased its U.S. lobbying spending in recent years to expand in competitor General Electric Co. (GE)’s home market. Europe’s largest engineering company spent $170,000 on campaign contributions last year, compared with $96,000 four years earlier, according to data compiled by Bloomberg Government, and has made high-profile hires to improve its access to power brokers.

Stanley McChrystal, the former commander of NATO forces in Afghanistan, was hired as the chairman of Siemens Government Technologies soon after it was set up in 2011, while former Michelle Obama aide Camille Johnston heads Siemens’s lobbying operations in the U.S.

Renewable Energy

The Defense Department is seeking to buy or produce at least a quarter of the energy it consumes from renewable resources by 2025. The Obama administration has pushed for alternative energy to reduce the nation’s oil imports from the Middle East.

The Pentagon wants to generate 3 gigawatts of is energy from renewable sources by 2025, with the Army contributing one-third of that total. The Siemens-led group was the only bidder to win approval from the army for all four sectors of the program: geothermal, solar, wind and biomass energy, according to the company.

The Army awarded 22 companies, including Spain’s Acciona SA (ANA), the right to bid for solar contracts, 17 the right to bid for wind projects, 13 the right to bid for biomass deals and five companies access to geothermal contracts, according to the government’s website.

To contact the reporter on this story: Alex Webb in Munich at awebb25@bloomberg.net

To contact the editor responsible for this story: Simon Thiel at sthiel1@bloomberg.net

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