Study: Ill. needs more wind-power manufacturing
While wind-power generation has created more than 19,000 short-term construction jobs in Illinois, the state has only about 800 permanent jobs at wind farms and is mostly missing out on potentially far more permanent jobs on the manufacturing side, according to a study released Tuesday.
The study from Illinois State University economist David Loomis highlights the economic benefits of wind power such as the construction jobs and property taxes in rural counties where turbine farms are built. But it also highlights one of the limits: It doesn't take very many people to maintain a wind farm once it's up and running.
So far Illinois only has a little more than 1,000 manufacturing jobs related to wind power, according to the American Wind Energy Association. That piece of the industry employs about 30,000 people around the country.
"The biggest impact is going to be on the manufacturing side," Loomis said. "There are good paying jobs for these rural areas in terms of tower technicians. But there's not a huge number of them for wind farms."
The study comes as the industry waits for the renewal of a federal tax credit that has driven a boom in wind-farm construction, something industry analysts say isn't likely in an election year. Without it, they say the subsidy-dependent industry will likely slow drastically down.
"It's going through a boom cycle followed by a potential bust cycle in 2013," said Matt Kaplan, associate director at IHS Emerging Energy Research in Massachusetts.
Illinois, according to the ISU study, is the fourth-largest generator of wind power among U.S. states at 3,334 megawatts, up from 2,443 megawatts a year ago.
Wind-farm building in the state has led to 814 permanent jobs that pay about $59,000 a year on average, a strong salary in the rural areas where the jobs are located, Loomis said.
But the manufacturing end of the business, particularly companies that can make parts for wind turbines, holds greater potential, he said.
Illinois State's Center for Renewable Energy has run a series of workshops for companies interested in working in the wind-power business; worked with state officials heading to wind-industry events to try to recruit manufacturers; and tried to match manufacturers interested in moving into the wind-power industry with turbine makers that need parts.
"I called it speed-dating opportunities. OK, give your five-minute speech, your pitch to the manufacturer, what do you bring to the table that's unique," Loomis said.
The Illinois Department of Commerce and Economic Opportunity's primary incentive program is its EDGE tax credits. It wasn't immediately clear Tuesday if any wind-industry manufacturers have received such credits.
The state has about 28 companies involved in some aspect of wind-power manufacturing, the Wind Energy Association says.
The study also says wind farms generate $28.5 million a year in property taxes. That money is heavily concentrated in the relative handful of central and northern Illinois counties with wind farms, but it can be locally significant.
The two major wind farms in McLean County, for instance, pay almost $5 million in property taxes combined, said Robert Kahman, the county's supervisor of assessments. That makes them the county's No. 2 generator of property tax revenue, behind only State Farm Insurance's Bloomington headquarters.
"That's a lot of dough, no matter which way you slice it," Kahman said.
But the wind-power business has been characterized as prone to booms and busts, driven by government mandates such as Illinois' requirement that a quarter of the state's power be generated by renewable means by 2025, and the federal production tax credit.
The PTC, as it's known, drove wind-farm building and turbine manufacturing over the past couple of years but is set to expire at the end of the year.
IHS Emerging Energy Research doesn't expect it to be renewed until after the November election, perhaps sometime next year, leading the firm to forecast a drop in wind-farm building from about 12,000 megawatts this year to about a thousand next year, Kaplan said. A few manufacturers in other states have already laid off workers or shelved plans to build new plants, he said.
University of Illinois economist Fred Giertz says reliance on government limits what the industry can provide in terms of power or jobs.
"It's never going to be a major contributor, even though there are these goals in the future," Giertz said. "It's never going to be a major supplier."
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