The wind industry has warned that Congress’ failure to renew a wind production tax credit would result in massive layoffs across the industry, and this looks to be the case already for one major wind manufacturer.
Siemens Energy Inc. announced this week that it will be laying off over 600 employees in the midwest as well as Florida. The company said in a statement that the layoffs were necessary in part because of the tax credit’s impending expiration, but also pointed to increase in natural gas-fired power plants as part of the crunch.
Hardest hit will be the large wind-turbine blade factory in Fort Madison, Iowa where 407 jobs will be eliminated. Siemens spokeswoman Melanie Forbrick said in a statement that about 220 employees will keep their positions in order to keep the plant operating. Another midwestern state–Kansas–will be hard hit by Siemens’ cuts as well: about half the Hutchinson, Kan., plant’s employees (150) will be affected by the layoff. Sixty-two employees in Orlando, Fla., will lose their jobs as well.
Siemens has invested heavily in U.S. wind manufacturing operations, spending about $100 million ramping up production and at its height, employing over 1,650 employees. With this round of layoffs, the company will retain about 1,000 workers in the United States.
The plant in Fort Madison, Iowa received millions of dollars from the Department of Energy in manufacturing tax credits and doubled in size from 300,000 square feet to almost 600,000 square feet in 2007. President Obama visited the plant in Iowa two years ago and drew attention to the fact the government’s stimulus money helped Siemens double the size of the plant.
“This is what’s possible in a clean-energy economy,” Obama said at the time. “And while it may not feel like it every day when you punch in, to all the folks who work here at Siemens, I want you to understand, you’re making it possible. You are blazing a trail. You’re showing America our future.”
Two years later, it’s a different political climate and a much different story.
“As a result, following the rapid ramp-up of the wind power industry over the past five years, the industry is facing a significant drop in new orders, and this has an unfortunate consequence on employment in this segment of the power industry,” Siemens said in a statement. “Now, we have had to make the difficult decision to adjust the manufacturing, projects and administrative support functions of our wind power operations to reflect the current and projected business volume.”