Since the extension of the production tax credit, European wind companies have been keener on investing in the U.S. market.
Several of the largest turbine producers are now selling to U.S. developers for projects, and opening offices and manufacturing plants in the United States. The federal production tax credit was extended for two years in August 2005 by President Bush. It was set to expire on Dec. 31, 2007, but was extended as one of Congress’ last acts and will now run through Dec. 31, 2008. The PTC provides a 1.5 cent per kilowatt hour credit, or 1.9 cents when inflation-adjusted, to energy facilities during the first 10 years of operation.
Siemen’s Wind Power Generation has a blade factory in Iowa that became operational last year. Within one year, the factory should be able to turn out about 250 blades, said Martin Oleson, manager of communications for Siemens.
Out of all the turbines it manufactures, Oleson said the 2.3 megawatt is the best-seller in the United States. The extension of the PTC was very important, Oleson said at the European Wind Energy Conference in Milan, Italy. Siemens had been involved in the United States previously, he said, but it stepped out when the PTC was set to expire.
“Now we believe very strongly in the American market,” Oleson said. He said the market seems strong enough now that it’s unlikely there will be another hiccup.
REpower is involved with two wind farms in the United States. One of the projects is Shiloh 2 in Northern California, which has 75 2-megawatt turbines, said Daniela Puttenat, head of corporate communications and public relations for REpower Systems. REpower is also opening a new office in Portland, Ore. The plant is a converted truck-trailer factory.
Puttenat also cited the PTC extension as the reason for the renewed and increased interest in the U.S. market. REpower is also seeking further opportunity to grow in Australia and Asia.
The recent growth in the U.S. market also convinced European companies to get involved. Last year, the U.S. wind energy industry installed more than 2,400 megawatts of capacity and is expected to install more than 3,000 MW in 2007, according to the American Wind Energy Association.
While traditionally countries in Europe, especially Germany and Spain, were the largest annual installers of wind power, the United States is catching up. Predictions for wind resources in the United States suggest great potential in the Midwest, along the East Coast and offshore in the Atlantic.
Gamesa Corporacion Tecnologica SA, a Spanish wind turbine manufacturer, has a production site in Pennsylvania and has several wind farms in development. Gamesa Wind US is in charge of manufacturing, selling, installing and maintaining turbines in the United States and Canada.
Now that the Iberdrola takeover of Scottish Power is complete, the Spanish power company will have control of PPM Energy, a former subsidiary of Scottish Power based in Oregon, and will acquire all its U.S. wind assets.
Vestas Wind Systems, based in Denmark, is also entering the U.S. market with plans for a $60 million blade factory in Colorado to be opened by early 2008. In March, Vestas received an order for 24 megawatts for a project in the Tehachapi Pass area in Southern California. The order was placed by Alite Wind, LLC, which is part of the Allco Wind Energy group based in Sydney, Australia.
Turbine sales have increased so dramatically in the last several years, a bottleneck has been created and there’s a waiting list for turbines that are getting increasingly more expensive as supply is constrained.
While GE Energy is still the major supplier for U.S. wind projects, the European companies supply about 44 percent and that figure is expected to grow and expand to other countries developing wind power.
By Kristyn Ecochard
UPI Energy Correspondent
14 May 2007
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