Connecting the dots: Job losses to China ... and ... consistent energy policy
Three items in the news yesterday offer an opportunity to connect some dots, something that doesn't always happen when our nation's policy makers deliberate. Here they are:
(1) Wind turbine parts makers say they are losing contracts, jobs to foreign competitors
(2) China and the EU strive for the lead in wind energy
(3) At Renewable Energy Finance Forum in New York, Financial Experts Warn that Inconsistency in U.S. Energy Policy will Dramatically Dampen Investment and Other Economic Benefits
To me, these stories tell ("shout" would probably not be too strong a word) a narrative about what is happening in the world today, and where we need to go with energy policy. It goes like this:
- The global wind energy industry is expanding rapidly, having gone from 17,000 megawatts (MW) installed in 2000 to 197,000 MW in 2010--more than 10-fold growth in a single decade. (To translate, that means growing from enough wind power to supply the equivalent of 5 million American homes to more than 55 million.)
- The China-EU article mentioned above quotes an EU expert as saying, "After hydropower, wind energy [currently] constitutes the biggest source of renewable energy on earth," and "Wind energy is expected to remain a buoyant market during the next four decades," and further, "Wind turbines are too heavy and unwieldy to be shipped over big distances. Manufacturers therefore have little choice but to assemble them in the countries of destination."
- This means that wind turbine manufacturers, and the companies that make the 8,000 components that go into modern turbines, are making decisions every day about where to locate the factories, and hire the workers, they need.
- The European Union and China are competing with the U.S. for those factories and jobs. Both the EU and China have strong, supportive, consistent policies in place to help their clean energy industries grow, and we do not. Since the U.S. federal wind energy production tax credit first was allowed to expire, in mid-1999, America's wind industry has never been more than a few years away from another expiration, and a drastic change in its financial outlook.
This brings us to the third news item, with financial experts calling for the enactment of a consistent long-term policy that will provide the certainty companies need to make major investments in America's economy and its clean energy industries.
AWEA Senior Policy Analyst Jessica Isaacs, who left AWEA recently to pursue graduate studies, made the same connection in a recent article here (see Demand-side policies will fuel growth in wind power manufacturing sector, June 14, 2011), writing:
"Based on experience in the European Union (EU), where long-term policies supporting renewable energy are in place, the potential exists to expand the jobs supported by the U.S. supply chain by a factor of three to four, potentially adding tens of thousands of additional manufacturing jobs. A prerequisite for this growth, however, is implementation of long-term, stable demand-side policies--such as renewable energy standards, clean energy standards, PTC, transmission guidelines, etc.--related to driving renewable energy investment over a minimum period of 5 years, though preferably longer."
So, that's what we have to do, if we want those turbine and component manufacturing jobs to go to American workers and not to one of our competitors in this rapidly expanding international market.
Demand-side policies will fuel growth in wind power manufacturing sector, June 14, 2011