October 27, 2010
Scotland

Turbine firm in cash crisis despite huge tax windfall

By Rod Mills, www.express.co.uk 27 October 2010

A firm offered almost £10million of taxpayers’ money to safeguard jobs in the wind turbine industry has gone bust, it was revealed yesterday.

The Danish energy company Skykon took over the Vestas wind turbine plant at Machrihanish on Kintyre last year after being offered financial aid by the Scottish Government.

The money was made available in a deal announced by Alex Salmond when he visited the site outside Campbeltown, although only £2.4million has so far been handed over.

The cash was to have secured the jobs of about 100 people employed by the company and to have helped create a further 300 posts. Vestas had been planning to shut the plant.

But Skykon, which was due to begin production within weeks, said that it had found itself in a “cash-strapped situation” and disclosed that it was suspending payments to its creditors.

Skykon was preparing to invest £35million in expanding the site and had ambitions to become a major international supplier of wind turbines.

But the company’s chief executive officer, Jens Pedersen, said yesterday: “The wind turbine industry is project based and very cyclical, and it is ­currently being affected by a number of negative factors in the wake of the financial crisis.

“These effects have also impacted Skykon to the effect that we are in a very cash-strapped situation.”

Skykon won a massive contract last year to supply Europe’s largest onshore wind farm development, Clyde Wind Farm, in South Lanarkshire.

A Scottish Government spokesman said: “Skykon has received £2.4million in Regional Selective Assistance instalments to specifically support jobs at the Kintyre plant.

“Not a penny more will be paid until the matter has been resolved, and Skykon have assured us they are seeking a solution.”

In a further blow to the renewables industry, Vestas Wind Systems, the world’s largest wind turbine manufacturer, said it would axe 3,000 jobs and shut some plants to adjust to weaker demand.

URL to article:  https://www.wind-watch.org/news/2010/10/27/turbine-firm-in-cash-crisis-despite-huge-tax-windfall/