Manufacturing the Winds of Change

By Dorothy Davis

Report calls for US manufacturing to support a burgeoning wind industry

In the summer of 2010, the American Wind Energy Association (AWEA), United Steelworkers (USW) and the BlueGreen Alliance held a teleconference to discuss the release of their joint report, titled "Winds of Change: A Manufacturing Blueprint for the Wind Industry," which they hope will inspire the US to action before it falls behind the rest of the renewable-energy-embracing world.

The comprehensive report is a call from the wind industry and certain key supporters to push for more concrete commitments from the US to ensure the growth of the wind energy industry and the multitude of American manufacturing jobs that can be established through it.

The development of renewable energy has been steadily growing as the potential economic and environmental perks become increasingly apparent to both energy providers and consumers. According to the AWEA, the US wind industry currently employs more than 2,000 people and contributes directly to the economies of 46 states, with power plants and manufacturing facilities that produce wind turbines, blades, electronic components, gearboxes, generators and a wide range of other equipment.

With nearly a seven- fold employment increase over the last five years, the wind industry has enjoyed a seemingly robust growth while establishing itself in the United States, but the Winds of Change report is quick to point out this relatively new domestic market is already starting to stall. The US simply does not have the right policies or incentives in place to help it thrive.

The potential economic benefits of wind as a renewable energy source are enormous, especially during a period in the US when manufacturing jobs are on the decline. Although the American manufacturing industry accounts for approximately $1.6 trillion of the US gross domestic product (GDP), it has in fact been struggling. The sector that essentially established America’s middle class has seen a more than 30 percent decline in its contribution to the GDP since 1987, according to the office of leading renewable energy advocate Ohio Democratic Senator Sherrod Brown

Senator Brown and his supporters also point out that the recent economic crisis has only exacerbated existing problems within the US manufacturing industry, and manufacturers continue to face a reduction in demand and a lack of capital. A recent survey found that more than 70 percent of manufacturers anticipate difficulties securing credit to purchase raw material and rehire workers as business conditions improve.

According to the Federal Reserve Board, manufacturing output fell 2.7 percent in January 2009 to a level 13.1 percent below that of only 12 months earlier. In May of this year, nearly half of the nation’s job losses were tied to manufacturing.

Without long-term strategic policies such as a Renewable Electricity Standard (RES) in place ,the report warns that America is faced with either making changes to support an industry that will enhance innovation and profit or being complacent with a future laden with industry stagnation and continued energy dependence.

The Winds of Change report has no shortage of strategic solutions; what has the wind industry worried is how indifferent and often indecisive the US has been in taking the steps necessary to nurture it. The release of the report was timely, coming just as Congress was expected to formulate a comprehensive climate and energy bill in July and strongly championed passing Senator Brown’s IMPACT Act (the Investments in Manufacturing Progress and Clean Technology Act of 2009), which creates a state-level revolving low interest loan fund of $30 billion dollars to help small- and medium-sized manufacturers retool for clean energy markets and adopt energy efficient manufacturing.

Senator Sherrod Brown was blunt in expressing the importance of the report’s message:

"This report represents a major alignment between our goals for energy independence and creating the clean energy jobs of the future," said the Senator. "This ‘manufacturing blueprint’ is a critical step toward ensuring that we don’t replace our dependence on foreign oil with a dependence on Chinese-made wind turbines. With the right policies, clean energy will help revitalize American manufacturing. We must ensure that American manufacturers have the resources they need to build clean wind energy components and by doing so, help establish America as a global leader of clean energy technologies."

Brown’s IMPACT Act is designed to address these challenges by providing critical access to capital and support for our nation’s small- and medium-sized manufacturers, which have been especially hard-hit by the economic downturn. By providing manufacturers with much-needed resources, Brown’s bill would enable broader participation in the clean energy sector that is emerging as one of the fastest growing segments of the economy.
The AWEA estimates that wind installations worldwide will total more than 100,000 megawatts over the next decade, or more than $100 billion worth of business. If the US industry could capture a 25% share of the global wind market through the year 2015, several thousand new employment opportunities would be created.

The Renewable Energy Policy Project (REPP) estimates that every megawatt of installed wind capacity creates about 4.8 job-years of employment, both direct (manufacturing, construction, operations) and indirect (advertising, office support, etc.). This means that a 50-megawatt wind farm creates 240 job-years of employment. According to a REPP study, boosting US wind energy installations to approximately eight times today's levels could create as many as 150,000 manufacturing jobs nationwide, with most jobs being added in the 20 states that have lost the most in recent years.

The Winds of Change report also followed a recent announcement by AWEA and USW on a "framework agreement" to drive the development and operations of wind energy production in the US As well as recommending a federal RES of 25 percent by 2025 with effective mid-term targets, the report also outlines steps to regulate greenhouse gas emissions and policies specifically aimed at building the US wind energy manufacturing sector.

David Foster, Executive Director of the BlueGreen Alliance, expressed just how precarious a place the US is in when it comes to helping the renewable energy industry flourish.

"Failure to act presents the very real danger that the United States will fall further behind in the race for clean energy and the manufacturing jobs that come along with it," said Foster. "We need to pass a comprehensive plan now to establish the United States as the global leader in clean energy technologies."

Finally, the report goes on to support extension and fortification of the Advanced Energy Manufacturing Tax Credit, fully funding the Green Jobs Act, and offering specific incentives and accountability provisions to maximize domestic job creation that will demonstrate to both foreign and domestic investors that the US is truly ready to make a long-term commitment to the success and expansion of the clean energy industry and leading the way in manufacturing the winds of change for American workers.

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