During his election campaign, Barack Obama made much of how investment in alternative energy would create a new generation in green jobs. So it is somewhat embarrassing that a report by the Investigative Reporting Workshop covered in the FT suggests otherwise. According to the article in the Financial Times, more than eight out of ten US stimulus dollars spent on wind energy farms has gone to foreign owned companies. Of the US$1.05bn distributed in grants this year, 84% have gone to the US subsidiaries of European companies. In the interests of fair reporting we should add that doesn’t mean the dollars have gone directly overseas, although more on that in a moment, but it does illustrate how far behind Europe American companies are in the renewable business and how that disadvantages US companies when it comes to meeting a surge in demand as created by the stimulus funds.
The 11 US-based wind farms that received cash grants from the US Treasury have imported 695 of the 982 wind turbines that are to be installed. The IRW report sights a study by the Renewable Energy Policy Project, a think-tank that advocates renewable energy technology research, estimates that for every 1,000 MW of wind energy that is developed, 4,300 jobs are created: 600 for operation and maintenance of the wind farms; 700 for the installation of new turbines; and 3,000 for manufacturing.
The cash grants were given for the installation of 1,763 MW of capacity 1,566 installed by foreign companies. Using the Renewable Energy Policy Project’s own numbers, as many as 4,500 manufacturing jobs may have been created overseas. The largest is Vestas Americas, a Danish company who has won something over 16% of the projects so far. But perversely, as Vestas has invested US$1bn in developing US facilities over the last two years, including manufacturing facilities in Colorado to build blades and has plans to open facilities to build towers and nacelles, US companies are moving their component manufacturing facilities to low cost overseas locations. GE now owns three manufacturing facilities in China and is opening another in Vietnam. It would seem regardless of the administration’s good intentions, their assertions that green stimulus funds will create a wave of US green manufacturing opportunities may turn out to be hot air.