Article from the Abilene Reporter News
West Texas wind projects on track while other areas experience slowdown
By Loretta Fulton
Wednesday, January 7, 2009
The wind industry is blowing and going in West Texas, despite a difficult economy and uncertainty over extension of a federal tax incentive, which wasn't approved by Congress until October.
On Tuesday, North Dakota-based DMI Industries announced a 20 percent workforce reduction at its three wind-energy facilities, citing "difficult credit conditions" that are making it hard for wind energy developers to secure project financing.
One of the facilities, located in Tulsa, Okla., announced it would cut about 50 workers. The other plants are in North Dakota and Ontario, Canada.
Locally, three wind-related projects announced last year are on track, with one in operation. None is affiliated with DMI Industries.
Illinois-based Broadwind Energy subsidiaries Tower Tech Systems and Energy Maintenance Service both will have new facilities in Abilene. EMS already is repairing wind turbine blades at its facility in the old Lockheed Martin building on Wall Street.
"They are up and running," said Bill Ehrie, who heads the Industrial Foundation of Abilene.
Tower Tech Systems is building a 140,000 square-foot facility in the Five Points Business Park, where it will manufacture wind towers.
The project should be completed this month, said Richard Burdine, chief executive officer of the Development Corporation of Abilene.
"They're putting equipment in now," Burdine said.
Also, Global Energy Services, headquartered in Conshohocken, Penn., leased part of the old Toys R Us store to house office and storage space and a training facility.
"We're still on track," said Brian Zuhusky, assets manager for GES.
Currently, the company is getting the required permits from the city to renovate the building, Zuhusky said.
"After that, it should be pretty fast," he said.
The facility is scheduled to open in late February or early March and will have about 30 employees. The company builds and maintains wind turbines.
Global Energy Services, Energy Maintenance Service, and Tower Tech all received incentive money from the DCOA, which administers Abilene's half-cent sales tax for economic development.
Industry experts say tight credit supplies, plus late congressional approval of a tax incentive for the wind industry combined to slow down business. But it is expected to pick up again later in 2009.
"It's not going anywhere," said Greg Wortham, who heads the West Texas Wind Energy Consortium in Sweetwater.
Wortham predicted the first half of 2009 may be weaker but that business would be back to normal the second half of the year.
One reason for the slowdown is that approval for extension of the production and investment tax credits for renewable energy businesses didn't come until October as part of the $700 billion financial industry bailout approved by Congress.
Wind energy companies put new projects on hold while waiting to see of the extension would pass. With approval coming so late in the year, it will be a while before new work begins. Wortham said the industry in this area is doing well, with 20 percent of the Nolan County workforce employed in some phase of wind energy.
When work isn't available nearby, those specialized employees can travel to other locations where they are needed.
"It's shifting around," Wortham said, "but the jobs aren't going away."
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