March 13, 2013
Iowa

Acciona to lay off near half of factory

Written by Adam B Sullivan | Iowa City Press-Citizen | March 11, 2013 | www.press-citizen.com

About half the workers at a West Branch turbine plant will soon be jobless following a layoff announcement Monday.

Acciona Windpower will eliminate 40 positions, company officials said. That follows hundreds of other wind energy layoffs in Iowa last year, but some say the sector is on the rebound.

Acciona Windpower officials are blaming the downsizing on lagging wind energy expansion.

“U.S. wind development declined sharply over the last year for reasons beyond our control, and the reduction in our workforce is necessary to meet the current volume of production while we work to complete new turbine supply agreements,” the company wrote in the statement.

Acciona Windpower North America CEO Joe Baker was among the industry leaders last year calling on federal policymakers to renew the wind energy production tax credit, which gives tax breaks to wind turbine operators, boosting demand for products such as those produced in West Branch.

Congress did finally extend that tax credit early this year, but Baker said uncertainty took a toll on business.

“The development decline is caused by a number of factors. … The late adoption of the (production tax credit) created a hole in (wind turbine generator) production opportunities in 2013, effectively pushing nacelle production into 2014,” Baker wrote to the Press-Citizen on Monday.

Former Gov. Chet Culver helped court Spain-based Acciona to Iowa and the West Branch facility opened in early 2008. The company has received state and local support, including a $2 million loan from the Iowa Economic Development Board.

Monday marked the second major round of layoffs at the West Branch facility in its six-year history. In 2009, Acciona laid off 58 employees, which was a third of its West Branch workforce. At the time, company officials called it a “short-term issue” due to the sluggish economy, but most or all of those positions never came back.

Last summer, almost 500 wind industry workers were laid off at other companies in Iowa. Clipper Windpower in Cedar Rapids reduced its staff by 76 and Siemens in Fort Madison cut 407 positions.

In addition, two planned wind projects in Johnson County have halted in the last year. A Maryland-based company had planned a foundry to cast turbine components in Iowa City while an Illinois-based firm planned a wind farm in Solon, but neither project is currently moving forward.

Despite the negative signs, Iowa remains a national leader in wind energy, employing as many as 6,000 wind workers. Iowa Wind Energy Association Executive Director Harold Prior said things are looking up for the wind energy sector in Iowa.

“It’s different from company to company, but what we’re seeing is a real quick resurgence of projects,” Prior said. “There may be a little delay until manufacturers see the ramp-up of orders. We’re expecting that by mid-year or so.”

The latest iteration of the wind energy production tax credit is only for one year. That means the industry could see another battle over the tax break late this year.