Apple Sweetens N.C. Economic Picture; Duke Helped Make the Deal Apple'splantobuildadatacenterinMaidenmightnothaveever gottenoffthegroundhaditnotbeenforDukeEnergy. StuHeishman,Duke'sdirectorofBusinessDevelopment,alongwith HarryPoovey,Duke'sEconomicDevelopmentmanagerforwestern NorthCarolina,helpedplugAppleintoMaiden.It'samatchthat couldmeantensofmillionsinannualrevenueforDukeEnergyand promisestosparkmuchͲneededeconomicgrowthinNorth Carolina'sCatawbaValleyregion. "TheycouldhavelocatedanywhereintheeasternUnitedStates,but ultimatelyfocusedonNorthCarolina,SouthCarolinaandVirginia," Heishmansaid."WithoutDuke'steamefforts,theyveryeasilycould Stu Heishman havegoneelsewhere.ThiswasathreeͲyearprocessandaclassicexampleofhowoursystemis supposedtowork.AllofthegroupsandpeoplewithinDukewhoworkwitheconomicandbusiness developmentissuesdidwhattheydobesttohelpusmakethisareality." Appleplanstoinvest$1billioninthedatacenter,makingitoneofthelargestcapitalinvestmentsinN.C. history.It'squiteasuccessstoryforDuke'seconomicdevelopmentteam,whichhasforyearsworkedto bringlargeͲandsmallͲscaleprojectstothecompany'sserviceterritoryintheCarolinasandtheMidwest. Essentially,alloftheteam'sworkisdonequietlybehindthescenes,underacloakofsecrecy.Allofthe recruitingeffortsaregearedtobenefitDukeandthecommunitiesitserves. Makingaconnection,settingthingsinmotion Apple'sdatacenterwillhouseacollectionofcomputerservers–computers thatprocessrequestsanddeliverdatatoothercomputersoveralocal network.TheCaliforniaͲbasedtechnologycompany,consideredbymanyto setthegoldstandardforinnovationandcreativityinbusiness,didn'tjust decideoutofnowheretobringtheoperationtoMaiden,asmalltownof under5,000inCatawbaCounty,about60milesnorthwestofCharlotte. Heishmangavetheideaabigpush.Backin2006,hedevelopedarelationship withApple'sdesignandprogrammanagementconsultingteam.Inlate2007, whenheheardApplewaslookingforasiteforadatacenter,hebegan pitchingMaidentotheconsultingteam,whichwasassistingAppleinlocating HarryPoovey asite.Poovey,whowaspartofbringingtheGoogledatacentertonearby CaldwellCountyafewyearsago,hadidentifiedseveralpotentialdatacentersitesin2006.Bothheand HeishmanhadworkedcloselywithCatawbaCountytodevelopadatacenterrecruitmentstrategy. Overthenextfewyears,alotofworkwentintowooingAppletoMaiden.
DanglingacarrotinfrontofApple Theprojectrequiredseveralpiecestofallintoplace.Amongthem:CatawbaCountyofficialshadtosell theirsitetoApple.Tobecompetitivewithotherstates,NorthCarolinahadtooffereconomicincentives toApple.(Eventually,N.C.lawmakerswouldmakechangesthatwillcutApple'sNorthCarolinataxbillby about$46millionoveradecade.)And,perhaps,mostimportantly,Dukehadtosellitselfasareliable providerofelectricitytopowertheservers. "Powercostandreliabilityareadatacenter'sprimaryconcerns,"saidClarkGillespy,vicepresidentof EconomicDevelopment,BusinessDevelopmentandTerritorialStrategiesforDukeEnergyCarolinas. "WewereabletoconvinceApplethatwewerecapableofprovidingthelowcostandreliabilitythey neededfortheiroperation." ApplewasimpressedandannouncedMaidenasthedatacenterlocationinJune2009.Thecompany requestedthatDukeEnergybeitselectricityprovider,andacontractwassignedrecently. Codename:ProjectDolphin AllofthemeetingsandtalksbetweenDukeandApplewerehighlysecretive,astheyusuallyarewith economicdevelopmentprospects.Infact,stateeconomicdevelopmentandCatawbaCountyofficials didn'tevenknowApplewasthecompanyinterestedintheMaidensiteuntilroughlyayearafterDuke hadbegantocourtApple. "ThiswasthebestͲkeptsecretinthedatacenterworld,"Heishmansaid."Thetalkswereextremely sensitive.It'sbettertokeepthingsquietforaslongaspossible.Ifwordleaks,itcouldaffectrealestate prices,stockprices,humanresourcesissues–ahostofthings.Wecertainlydon'twanttoinfluence values,andwedon'twanttheprospectivecompaniesinundatedbyconsultingfirmsandvendors seekingbusiness." Initially,Heishmanusedthecodename"ProjectGͲ2"(GreferstoGoogle).Helaterchangedthecodeto "ProjectT5."Inlate2008,whenApplebegandiscussionswithCatawbaCountyandstateofficials,the groupchosethecodename"ProjectDolphin." "Supposedly,dolphinstravelinpods,anddatacentersareusuallybuiltinpods,"Heishmanexplained. Datacenterbesttypeofcustomer WhydidDukeputsomuchtimeandeffortintoattractingApple?Adatacenter,commonlycalleda serverfarm,isadesirablebusinessforseveralreasons,Gillespyexplained. "ThegreatthingaboutadatacenteristhattheyrunfullͲout,24Ͳ7,withnoshiftsandnoseasonality,"he said."It'sthetypeofcustomerwherethemeterspinsandspinsatanexponentialpace.Itmaybethe mostidealcustomerwecouldhave." "WefullyexpectAppletobeoneofourtoptencustomersintheCarolinas,"Heishmanadded.
HowDukeworkstolurebusiness AttractingbusinessestoDuke'sserviceterritoriesisaprocessthatmainlyinvolvestwogroupswithin DukeEnergy–BusinessDevelopmentandEconomicDevelopment.Heishman'steamofbusiness developersinitiatestheprocessbydevelopingbusinessleadsandcourtingprospects,whileDuke's "economicdevelopers,"likePoovey,takeovertheprocessafterprospectivebusinesseshavebeen identified.Theyassistinfindingpotentialindustrialandcommercialsites.Theyalsoworkcloselywith stateandlocaleconomicdevelopmentofficialstoclosethedeals. Datacentersaren'ttheonlybusinessesDukewantstoattract.Thecompanytargetsotherindustries thatareheavyusersofelectricity:lifesciences,foodandbeverages,automotive,andmanufacturersof alternativeenergy/renewableenergyequipment.BusinessDevelopmentmanagersareassignedtoeach industry. "Eachmanagerhasauniqueskillsetandstyle,alongwithanextensivenetworkofbusinesscontactsin theirrespectivetargetmarkets,"Heishmansaid."RonnyDavis,ourautomotiveguru,hasanincredible networkofcontactsandareputationforbeingoneofthebestbusinessdevelopmentguysoutthere. EmilyFelt,whofocusesonthelifesciencesandfoodandbeverage,hasStanford/Harvardcredentials, extensiveinternationalexperienceandspeaksfluentJapanese.ShehaspositionedDukefornumerous internationalopportunities." "WhileAppleisanimmensewin,andweshouldallcelebrateit,dayͲinanddayͲoutwe'retalkingto someofthemostͲrecognizablenamesnationallyandinternationally,"Heishmanadded. It'sagreatadvantageintheenergysectortohaveafullͲfledgeddepartmentdevotedtobusiness development,Gillespysaid.Dukeexpandeditsinvolvementseveralyearsago,whentheN.C.state governmentcutbackonitseconomicdevelopmentefforts. "Ittakesacrossfunctional,teamapproachtopullthistypeofinitiativetogether."saidBrettCarter, DukeEnergyCarolinaspresident."EconomicDevelopmentisvitaltooursystemgrowth,andourlowͲ costenergyandthereliabilityofoursystemplayabigpartinattractingfirms." GooglewasperhapsthemostnotablecatchintheCarolinasbeforetheAppleannouncement.Whenthe searchͲenginegiantdecidedafewyearsagotobuildadatacenterinLenoirinCaldwellCounty,N.C., Dukehadahandintherecruitingeffort.
Benefitsforothers CaldwellCountyisalreadyseeinganeconomicboostfromtheGoogleoperation,whichemploysabout 50fullͲtimeworkers.ItisexpectedandhopedthatMaidenwillseeabenefitfromitsdatacenter,too. Thetown,knownforitsfiercehighschoolfootballtradition,hassufferedeconomically,alongwithother partsoftheCatawbaValleyregion.Evenbeforethecurrentrecessionhit,thetownwasreelingfrom blowstothetextile,furnitureͲmakingandfiberͲopticcableindustries. ItisexpectedthattheAppleoperationwillbring50jobstothearea.Inadditionto50newfullͲtimejobs, thecenterisexpectedtobring250indirectjobsandtheimpactcouldeventuallybe3,000jobsinrelated industries. "Thisisoneofthebestthingstohappentothatareainalongtime,"Cartersaid."Datacenterstendto clusterinaregionandthedominoeffectisprettypowerful." Therecessionmakeseconomicdevelopmentevenmorecritical,Heishmanadds. "ForDukeEnergy,ourroleiscrucialinhelpingtoreplacethelostrevenuefromthedemiseofthetextile andfurnitureͲmanufacturingindustries,"hesaid."Likewise,asavestedcorporatecitizenofthestates werepresent,wemustcontinuetoassistourstates,countiesandregionsincreatingjobopportunities."
