Rolls-Royce Power Solutions Leads the Way to Carbon Net-Zero
Things are hopping at Rolls-Royce Solutions America Inc. in Mankato, where RRSA manufactures power solution products under the mtu brand. The assembly lines at 100 Power Drive are bustling with activity as generator sets in various stages of completion move down the lines. The clean, bright space has soaring ceilings to accommodate the cranes and carriers required to move products that weigh tons and are roughly the size of a large RV.
Out on the production floor, employees efficiently build, test and package “gensets” for shipment. Remote-controlled skates glide by, carrying partial assemblies down the line. Production sounds fill the air as bolts are torqued and forklifts beep to clear a path. It’s the sound of a thriving business.
As Jason DeBus, the director of operations for RRSA in Mankato, gives us the tour, it’s clear he is proud of his team and all they have accomplished.
“We’ve got a team that wants to work together to be successful,” DeBus said. “They’re up for coming back for the next day’s challenge versus just coming in and doing the work. We’ve got that sense of urgency. It’s a great culture.”
The last three years have been one heck of a ride for DeBus and his team. He joined RRSA in 2019. During his brief tenure, he’s guided the company through a pandemic, supply chain issues, and staffing shortages – all while riding the wave of three consecutive years of significant growth.
The appetite for power generation products is voracious right now. RRSA is churning out products as fast as it can make them, but not fast enough to keep pace with demand. Its production schedule for 2022 and 2023 is booked solid for some products, and RRSA is now taking orders for 2024 delivery.
“Capital investment in North America is driving this immense growth. A large part of it comes from data centers. It’s the infrastructure that’s needed in the world today to support all the electronics and cloud-based applications,” DeBus said. “They’re in full-on growth mode. Being a supplier to those data centers is driving most of our growth.”
Data centers, hospitals, and other mission critical applications are all looking for power solutions to ensure the lights stay on at their business, no matter what. That’s the promise RRSA and its mtu branded power systems fulfill: power that never fails.
“When businesses face challenges with the weather or the electrical grid going down, we are there to power up those sites,” DeBus said.
The next decade will be transformative for RRSA as it converts all its sites around the globe into net-zero, carbon-neutral facilities, a goal it plans to achieve by 2030.
I sat down with DeBus to discuss the many changes and opportunities RRSA is experiencing in Mankato.
Could you briefly recap your career, and what brought you to Mankato and Rolls-Royce Solutions America Inc?
I’ve been in the supply chain and operations arena for close to 30 years. I’ve been in multiple industries, including computers, health care, power generation, water management, and plumbing and heating manufacturing/distribution. So it’s been quite diverse, which is good. It allows me to look at things in many different ways. You can take the best from different industries and try to bring it together to come up with the optimal solution.
What brought me to mtu was the opportunity to return to Southern Minnesota, where I grew up. I’m originally from Welcome, Minnesota, and I was an undergrad at Minnesota State University, Mankato. So it was a great opportunity to join a great company and work with great people.
Your current title is director of operations/RRSA accountable person. What does that encompass?
I oversee everything in the Mankato operations and supply chain with the responsibility of looking over everyone. The RRSA accountable person role is really about health, safety and the environment. So from that perspective, I have responsibility for all of our facilities and employees, no matter where they’re located.
What’s your leadership style?
Entrepreneurial, genuine, empowering, agile, strategic.
How does your approach serve RRSA?
It’s good for growth and the challenges we face in the current post-pandemic environment. It’s also good for the new product portfolio. It allows us to look forward instead of focusing on the here and now, so we are set up for success in the future.
What products does RRSA produce here in Mankato, and why are they important in the world today?
We produce mtu generator sets that range from 30 kilowatts all the way up to 3.25 megawatts. It’s important because it’s backup power. It’s emergency power. It’s distribution for prime power and backup power for hospitals, data centers and really all mission critical applications. So it supports many different industries.
A significant amount of our product is for data center customers. They’re putting large amounts of generator sets on a single property. If the power ever goes down, all those gensets kick in and keep the data center going. Then the customer starts a contingency plan to move that data to other data centers. So the customer only needs them to run for a day to two days at most.
RRSA production employees assemble mtu generator sets.
You recently expanded your Mankato facilities. What did that project encompass?
Rolls-Royce made a $17 million investment in the Mankato area between 2020 into 2021. We’ve got a new R&D facility where a lot of the prototyping and testing is done. It gave the R&D engineering team their own space, their own test bench, so they are not constrained or handicapped by what production is doing.
Therefore, they can work on prototypes at a much higher speed and agility. We’ve also moved our controls group over there, so they have a dedicated space where they have more room to do their own testing and not be constrained. So at the time when we built it, there was little to no room for them in the operations footprint.
We also upgraded our test benches, remodeled our office space and put in a new delivery road system to improve safety. The biggest change was the expansion of our Power Drive manufacturing location. If you came in three years ago, this place didn’t even remotely look like what it does today. We added 25 percent to the footprint of this building, expanding the production area to the south and east to increase capacity and capability. It will help support growth, new products, future volumes and capabilities we don’t have today.
When it comes to the products made here in Mankato, where are your customers and suppliers located?
Our supply base is North America-driven, and we have a large majority of our suppliers within a 100-mile radius of Mankato and mtu is supporting them. They’re partners, and we want them to grow with us and for us to grow with them.
We try to keep local as much as possible when it makes sense. We have alternative suppliers, obviously, to back our primary ones. It helped us in the pandemic that we had closer supply chains than longer international ones that would have impacted us worse than it did.
If you count Mexico as domestic, we’re almost all domestically sourced, which is good. So we’ve got a lot of local suppliers. We also have a sister plant in Aiken, South Carolina that provides all of our high horse power engines.
The majority of our customers are also in the Americas. We occasionally will support other locations around the world. We have a North American distribution network that we’ve partnered with that represents us out in the marketplace, and are drivers of sales and service. We have direct customers as well, where we’re dealing directly with large end-users of the product.
What is the scope of the RRSA operation here in Mankato?
This business drives about 425 jobs in Mankato. We’ve added at least 20 percent to our headcount in the local area in the last year, which is fantastic. We run four 10-hour shifts in operations and logistics, and they’re all busy out there right now. We’ve had to increase our output by more than 30 percent in each of the last two years, which is great for our business locally.
It’s a tough environment for hiring new workers right now. Are you able to recruit enough staff to meet demand?
We’ve got a great group of people here. They’re all very dedicated to the organization, very loyal and very accepting. But they also understand that business needs to be done and put urgency where it needs to be to ensure that we take care of our customers. We’re a good partner to our customers and suppliers, and we do the right thing in the community. There’s a lot of energy and teamwork. Our success is definitely due to our employees more than anything else. They continue to try to work smarter, be proactive and drive success at the execution level.
How do you build a driven, connected team?
One, it’s rallying around our purpose. Two, it’s being transparent, open, and honest with everyone while also being respectful and mature. I think those are some of the big drivers. I believe some of these qualities are inherently part of Southern Minnesota culture.
We’ve got a lot of tenured employees with this organization. Employee loyalty has just been a legacy carried on through the generations, from the Katolight days through to Rolls-Royce.
What are you doing to attract and retain talent?
Once upon a time, this was the place to be. We used to have people standing at the door. Now we’re trying to make it the place to be again. We need to get the word out. Maybe people don’t know what Rolls-Royce is. Maybe they don’t even realize what the mtu product is. They refer back to the Katolight days.
Like a lot of companies, we’ve struggled to get people in the door. We’ve been doing fairly well, but we’ve still more to add to get where we want to be. We’ve approached the market with sign-on bonuses and run radio advertisements, but a lot of our recruiting has been word of mouth. We’ve had great success with employee referrals. So our people are our best recruiters, which demonstrates the positive culture we have.
Your website uses words like “cleaner” and “smarter” to describe mtu products. How are you making these goals a reality?
The future is sustainability. By 2030, all Rolls-Royce sites are expected to be carbon neutral in how we operate and produce. By 2050, we’re trying to get our product out in the field to be carbon net neutral. That carbon net-zero goal is pretty exciting. Our customers are driving us into sustainability and green, as well. They’re trying to reduce their carbon net-zero footprint just like we are.
We have started focusing on efficiency first, which means the most sustainable energy is the energy we are not consuming. Second is to exploit on-site potential. As pioneers in the sustainable on-site energy solutions, we aim to maximize self-generation and minimize external procurement of energy. Third is to collaborate with local partners. We actively drive the energy transition by collaborating with project developers to add renewable energy capacities to the grid in close proximity to our sites if feasible. Last will be energy certificates as interim solutions. We carefully select and purchase high-quality renewable energy certificates if necessary to meet our emissions reduction target.
We’ve got to be agile. A lot of it is driven by what the customer’s wants and needs are and how they’re changing. We’re giving them what they truly want. The changes that are taking place with the environment and sustainability are driving our path forward at a much faster pace. We have to respond to a lot of new demands, while also being environmentally conscious to drive us to be more “green.”
So, we’re getting prepared to move the focus of our business to sustainability. A third of it is existing products, a third of it is how we modify our current portfolio to be more carbon neutral, and then a third of it will be new products, whether it be battery containers, electrolyzers, hydrogen fuel cells or hydrogen gensets. It’s pretty cool stuff.
Is it feasible that a microgrid system could power this entire facility?
Absolutely, and currently is in the planning phases.
Will microgrid production move to Mankato?
The battery containers, solar, wind turbines, electrolyzers, fuel cells, and hydrogen and gas gensets are all components of the microgrid system plan in our product portfolio. We’ll start producing them in Mankato.
Leading the race to green energy would be a big win for RRSA.
It gets us ahead of the game and drives being a market leader in sustainable solutions. What’s important is that we deliver what our customers want, and we deliver on our service, our quality and on having a great product for those customers. It doesn’t turn into a price-driven commodity market. We provide value versus just the product. We are also working on programs to use hydrogen in our reciprocating engines, both in a blended and full hydrogen form.
Are there any trends in the power generation or manufacturing industries that are impacting how you do business?
Yes. On the power generation side, it’s about who can be the most agile and responsive to our customer needs. We have positioned ourselves very well to capture opportunities. Again, there is a push to look at more renewable fuels. Instead of standard diesel, utilizing HVO and other renewable fuels.
On the manufacturing side, we’re looking at a lot of things, from just-in-time and lean methodologies to managing inventory to respond quickly without incurring unneeded capital. We’re trying to find the right balance. What does it look like now versus what it might have looked like three years ago? Global supply chains for us and our suppliers are facing all kinds of challenges, from astronomical costs to ship product to delays of capacity in ocean and air freight to domestic trucking. So just in time is not the ultimate answer anymore and again it’s looking for the right balance to deliver to our customers and have 100 percent quality in what we do.
An RRSA employee adjusts a part on an mtu generator set at the company’s Mankato manufacturing plant.
Do you have plans for future growth?
Rolls-Royce made a conscious effort to invest in Mankato even in the poor economic times going into 2020. We all realized that was the right decision, even though it was a little painful. We’ve already outgrown the expansion.
We’ve already starting evaluating our Mankato footprint to understand what we need to do to meet our goals going into 2030 and even further into the future. We’re also allocating funding to grow even more into the community.
What achievements are you most proud of?
One is our safety culture. The organization takes safety very seriously. We’ve seen significant improvements in the type of incidences we have. We have transparency and people speaking up when they feel that there is an unsafe situation. So, it’s really changing that culture of safety. It’s been fantastic, and our employees drive that.
Quality is another aspect. We continue to raise the bar when it comes to delivering the best product in the industry and investing into our groups to meet zero quality defects.
Other achievements include seeing the expansion through, year-over-year growth, and being able to respond to the market as well as we have through the pandemic. It is something that our entire team feels has been a success. Of course, we may feel defeated on days when things don’t go right. But overall, we’ve responded to our customers’ needs as best as anyone could have expected.
What is your biggest challenge right now?
It’s the supply chain. We see shortages across all industries. With all the supply chain issues globally, we have to start building units even though we don’t have all the components we need to finish the product. We can’t give up the capacity slots. So we’ll build them, and then quarantine out of process, waiting for the parts to come in.
Lead times have far exceeded what they had been in normal times. It’s happening throughout the industry, not just with us. We are working as diligently as possible to build more agile supply chains to increase our output and bring those lead times back in as quickly as possible.
We’ve been relatively successful in managing on-time delivery to customers. So, the challenge is making sure that we balance out supplies the best we can to take care of our customers, whether it’s finding a locally sourced product or looking at our processes completely differently than we have in the past to figure out how we can be more agile.
Then the other challenge is with the area’s low unemployment. Getting staffed up to where we need to be to meet increased demand is tough.
It sounds like these challenges are prompting process changes that will serve your company in the long run.
The pandemic and its impacts have forced us to reinvent ourselves a little bit, to look at things differently than we had in the past. We don’t have to react, but we can proactively address the situations. So again, it goes back to agility. We’re starting to see different issues that maybe we hadn’t in the past, but it’s making us better as an organization and better prepared for the future.
Is there anything else you’d like our readers to know about RRSA?
Rolls-Royce Solutions America is set up for success and growth. It’s been a part of the Mankato community for many years, with solid roots that go back to Katolight. It’s a great place to work and our people make the difference.
Bringing Sustainable Options to Mankato
Microgrids and hybrid power solutions are some of the newest offerings in the RRSA power generation product line. They promise to bring businesses grid independence, energy cost savings and climate-friendly emissions.
As DeBus explains, RRSA in Mankato will soon be developing a microgrid solution consisting of fuel cells, electrolizers, batteries and hydrogen-powered generators, with the potential to power its Power Drive plant.
“To help meet the RRSA carbon net-zero goal, we plan to set up a prototype of the next evolution of battery container systems to help support a microgrid. It’s an expandable system that can handle multiple megawatts of power. Our sister site down in South Carolina has a microgrid, and we’ll put one here in Mankato, too. Then when a customer visits, they can see what we have to offer,” DeBus said.
DeBus envisions a microgrid solution at the Power Drive production facility, which will make the facility energy independent and provide opportunities to integrate sustainable power components. It will be a win-win for RRSA as it will function as both a power source and sales showcase that will surely draw visitors to the Mankato location.
“Adding a microgrid to our Power Drive building will showcase the microgrid system and help with our carbon net-zero goals,” DeBus said. “We’ll put transformers in and run our generators to power up the batteries. It will allow us to produce our own electricity and take the building off the grid. We may also put in solar panels and wind turbines. If we do, we may actually sell power back to the energy company. That’s pretty cool.”
If RRSA surpasses its own energy needs, DeBus plans to roll that power back into the plant in a move that is sure to be met with enthusiasm by RRSA assembly workers.
“My goal once we’re off the grid and self-supporting is to put air conditioners on the roof so we can cool this (production area) down in the summertime,” DeBus said.
Now that’s a great idea!
The Evolution of Rolls-Royce in Mankato
Rolls-Royce Solutions America Inc. manufactures power generator sets under the mtu brand at its Mankato factory. Its Mankato facilities include a manufacturing plant on Power Drive, an R&D building on Energy Drive, and two warehouse and logistics centers, one on Lundin Boulevard and the other on Industrial Road.
Though the Rolls-Royce and mtu names are relatively new to the area, this company has been a part of the Mankato business landscape in one shape or another for 70 years. Mankato residents may remember its early incarnations as Katolight and MTU Onsite Energy. A brief history of its evolution from Katolight to Rolls-Royce Solutions America Inc. follows:
1952: Katolight is founded in Mankato as a spin-off of Kato Engineering. The new company focuses on building generators under the Katolight brand.
2000: Katolight moves to its current location at 100 Power Drive in Mankato.
2007: Katolight is acquired by Tognum, a worldwide supplier of diesel engines based in Friedrichshafen, Germany.
2008: Combining the Katolight, mtu and Detroit Diesel brands, Tognum forms the MTU Onsite Energy global power brand.
2014: Rolls-Royce completes its acquisition of Tognum AG. The company name changes to MTU America Inc.
2021: Rolls-Royce Solutions America Inc. becomes the legal entity for all North American MTU America Inc. locations, selling generator sets under the mtu brand.
Rolls-Royce Solutions America Inc.
100 Power Drive
Mankato, MN 56001
Phone: (507) 625-7973
Photography by Jonathan Smith