From Sign On San Diego:
Money is used to buy turbines made abroad
BY BROOKE WILLIAMS WATCHDOG INSTITUTE
TUESDAY, FEBRUARY 9, 2010 AT 12:02 A.M.
China’s A-Power Energy Generation Systems lists a vacant office in downtown San Diego as its U.S. address. Brooke Williams
Online: Local wind-energy leaders explain why U.S. firms are falling behind in getting stimulus dollars on10News.com. And for the workshop’s full investigation into wind-power funding, go toinvestigativereportingworkshop.org.
Of the more than $2 billion the federal government has given out to boost the economy and create green-energy jobs, more than three-quarters has gone to foreign-owned companies that dominate the global wind-power industry. This latest finding by the Investigative Reporting Workshop, a nonprofit atAmerican University in Washington, D.C., is illustrated clearly in San Diego County, where about a dozen commercial wind developers have offices.
La Jolla is the headquarters for Eurus Energy America, the subsidiary of a Japanese firm that received $91 million in federal stimulus money for a wind farm in western Texas. It plans to apply for more money to fund a wind project in Oregon.
EnXco, a French-owned firm with American headquarters in Escondido, has received $69.5 million in stimulus money for its wind farm in Indiana. It installed 53 German-made turbines at the site. EnXco also is operating the Texas wind farm for Eurus.
A-Power Energy Generation Systems, a Chinese-owned company that might get federal grants through a consortium building a wind farm in western Texas, lists a vacant office in downtown San Diego as its U.S. address on recent filings with the Securities and Exchange Commission.
Cannon Power Group of San Diego has received $19 million to expand a wind farm east of Portland in Washington. The company spent about half of that money overseas to pay for wind turbines it said it couldn’t get stateside.
The Reporting Workshop’s initial analysis of wind-energy grants was released in October and outraged some lawmakers. Sen. Charles Schumer, D-N.Y., cited the group’s report — and news that $450 million in stimulus money might go to a group installing Chinese-made wind turbines in Texas — when he asked the secretary of energy to deny federal financing to firms that use foreign-made turbines.
American wind companies are receiving stimulus grants, but some such as Cannon Power spend much of that money abroad because few U.S. companies manufacture turbines.
Mark Anderson, chief executive officer of Eurus Energy America, a subsidiary of Tokyo-based Eurus Energy Holdings Corp., said his company would not have been able to move forward with other projects without the guarantee of stimulus money.
Eurus received $91 million in grants for the Bull Creek Wind Farm in Texas. It has the capacity to power about 48,000 homes a year.
Eurus is building a wind farm in Oregon. The company plans to seek green grants for that project, Anderson said.
“We plan to put more and more money into the United States,” he said.
Eurus employs 20 people in San Diego, Anderson said, and has assets worth hundreds of millions of dollars.
Its Texas project created between 300 and 400 jobs for construction, including 10 for operation, and is benefiting the local economy through property taxes and land leases, Anderson said. For the project, Eurus bought Mitsubishi turbines, which are manufactured abroad.
EnXco, the French-owned firm based in Escondido, also went abroad to buy turbines, from German manufacturer REpower. A spokesman for enXco said the project created more than 200 construction jobs as well as a dozen permanent jobs. It has the capacity to power about 29,000 homes per year.
A-Power, based in northeast China, is part of a group building a wind farm in western Texas using turbines it is manufacturing in China. This is the project that affronted Schumer after the group announced plans to collect $450 million in stimulus grants.
In a letter, Schumer asked Energy Secretary Steven Chu to reject requests for stimulus grants from companies that buy key components abroad.
“In all due respect, I remind the secretary there is a four-letter word associated with the stimulus — J-O-B-S,” Schumer told ABC News. “Very few jobs here, lots of jobs in China. That is not what I intended or any other legislator who voted for the stimulus intended.”
Chu responded on Facebook: “But manufacturers will not build plants here and grow their production capacity here unless there is domestic demand; and, until recently, that was not the case.”
In SEC filings this year, A-Power Energy Generation Systems lists a suite in a high-rise in downtown San Diego as its business and mailing address. However, the suite door is locked, and a building manager said A-Power is not a tenant.
When reached on his cell phone, Chief Operating Officer John Lin said he did not have time to answer questions.
Gary Hardke, president of Cannon Power Group, a renewable-energy company near Torrey Pines, said his company had no choice but to go abroad to buy parts for its wind farm in Klickitat, Wash. Two main U.S. manufacturers, GE Energy and Clipper Windpower, either did not make a turbine the size that Cannon wanted or were sold out.
Cannon bought the turbines — made up mostly of blades, towers and nacelles (the part in the middle that houses components such as the rotor and generator) — from Siemens, a German company that also was the main contractor.
In all, Hardke estimated, more than 50 percent of the stimulus grant went to Siemens.
“I appreciate that cosmetically it doesn’t look good, but the reality is … the grants (must) go into the project costs,” he said.
Cannon is expecting $151 million more in stimulus grants to expand the wind farm and hopes all the parts will come from the United States.
Hardke pointed to ways the stimulus cash will do what lawmakers intended — boost the local economy. Cannon pays about $3 million a year to lease land from about 40 individual owners as well as $2 million in property taxes.
The project is in a county where nearly 20 percent of residents earn less than the poverty level, according to a 2009 U.S. Census release. It created more than 300 construction jobs, Hardke said, and 20 to 30 to operate the farm.
“There isn’t a family in Klickitat that doesn’t know someone employed by the project,” he said.
“The ongoing economic development benefit in rural America is really significant.
The icing on the cake, he said, is “clean energy — really significantly helping the environment.”
Brooke Williams: firstname.lastname@example.org email@example.com
Review the full investigative report here: Investigations | Wind Energy Funds Going Overseas | Investigative Reporting Workshop
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