It’s a sad and familiar story. Hundreds of local workers lose their jobs when the local plant moves to a foreign country. A once thriving community is left wondering where to turn for jobs, economic opportunity and hope for the future.
That’s what happened in Newton, Iowa (population 16,000) in 2007, when a corporate merger shuttered the Maytag plant, the town’s primary employer for generations. But there is a second chapter to this story.
Our wind energy manufacturing company has created 700 new jobs in Newton, and a second wind energy company now employs over 100 people.
Our industry can do the same in hard-hit towns all across the U.S., if Congress will let us and doesn’t increase taxes on wind power in the New Year.
American wind power has grown fast, and now provides more than a third of all new electric generating capacity across the U.S. in recent years. That led us to transition our company from building boats to building blades for wind turbines.
We opened a $56 million, 316,000 square-foot wind blade manufacturing plant in Newton three years ago. Many of our workers formerly worked for Maytag. And down the road, a fellow wind manufacturing company is rolling steel towers for wind turbines out of the actual plant where Maytag used to make washers and dryers.
What is happening in Newton is happening all across the country, although many people don’t realize it. Wind energy is a market that the U.S. is winning. We are actually creating a whole new manufacturing sector right here at home, and tens of thousands of good, old-fashioned American manufacturing jobs.
This is because wind energy is different. Our components are so large – some wind turbine blades are approaching half the length of a football field – that it becomes much cheaper to build them close to where they will be deployed. That means factories in the windy heartland, states like Illinois, Ohio, Kansas and Iowa.
These economics are driving a surge in wind manufacturing. Over the last six years, U.S. domestic production of wind turbine components has grown 12-fold, to more than 400 facilities in 43 states. This has helped shift manufacturing jobs from overseas back to the U.S.
We know how hard it is to create American jobs. Our company has a plant in Mexico and one in China, but we also have a couple in the U.S., because they make economic sense. The higher cost of U.S. labor can be offset by high transportation costs of these very large components.
Iowa is now the national leader in wind, with 20 percent of its electricity coming from this clean homegrown energy source. And the Iowa example is poised to spread across the U.S.
A recent study found that with stable tax policy, the wind industry can grow to nearly 100,000 American jobs in the next four years – including an increase in the wind manufacturing sector by a third, to 46,000 American manufacturing jobs. This will keep the wind sector on track to support 500,000 jobs by 2030, as projected by the U.S. Department of Energy during the George W. Bush administration.
All that is needed is Congressional action to keep the tax rate stable and low on this homegrown American energy source. That is why extending wind’s federal Production Tax Credit (PTC) is so important. If Congress raises taxes on wind energy by letting this tax rate expire in 2012, many of the good U.S. manufacturing jobs we’ve been able to create will evaporate. American wind energy jobs overall will be cut in half, according to a new study by Navigant Consulting.
This is not a Republican or Democratic issue: this is an American manufacturing jobs issue. That is why business-friendly groups like the National Association of Manufacturers, the American Farm Bureau Federation, the Edison Electric Institute, and the Western Governors’ Association support a PTC extension.
Twenty-three Republican and Democratic governors from across the U.S. have formed a coalition to seek more wind energy and the jobs that result.
Presidential candidate Ron Paul visited our factory himself in October. He told reporters in our conference room that, “As a believer in the free market, I don’t look at a tax credit as a subsidy.”
And when we sent a 130-foot-long wind blade to the Iowa Straw Poll this August, thousands of Republican voters covered it with their signatures. Among the signers were GOP candidates Mitt Romney, Newt Gingrich, and Paul, as well as then-presidential candidates Herman Cain, Tim Pawlenty, and Thaddeus McCotter.
After Gingrich signed our wind blade, he said, “One of the major problems we have with renewable policies is that the time horizon on the tax credits is too short, and the degree to which they get caught up in congressional politics leads to a sort of an up-and-down effect so you can't get capital investment over time.
“If you are going to have tax credits that are designed to create investment,” Gingrich continued, “they have to have a long enough time horizon that people who invest believe they will be there. Otherwise, if you are trying to build a new factory, if you are trying to create a new technology, you get halfway there and suddenly it expires and all of your calculations were wrong. So I favor having a ten-year-time horizon."
Now if Congress will let us finish the job, wind energy can do for America what we have already done for Newton, Iowa: Create U.S. manufacturing jobs right here at home.
Steve Lockard is CEO, TPI Composites, and a board member of the American Wind Energy Association.