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Denmark

Denmark

Big commitment in America

Denmark's Vestas, after years of being poised on the brink of establishing full scale wind turbine manufacturing in the United States, has taken the plunge. From 2010 it will be assembling both its 2 MW and 3 MW wind turbines at an initial rate of 1400 nacelles a year from a EUR 75 million ($111 million) facility at Brighton, Colorado, close to Denver. Blade production in the US is also to be doubled with the opening of a EUR 125 million blade facility, also in Brighton, which will produce 3600 blades a year. The new factory will supplement existing blade production in Windsor, Colorado.

On the same 2010 schedule, Vestas is building a new tower facility in Colorado to produce about 900 towers a year. Pueblo is hinted at as a top pick for the location, though that is not confirmed. The blade factory and nacelle factory alone will employ 1350 workers.

Vestas has long said it will only invest in wind turbine manufacturing in the US if it is confident of a stable long term market. That confidence is apparently in place, despite the potential demise of the US federal production tax credit (PTC) for wind power, which has been the main market driver for the past several years, at the end of this year. "The favourable long term prospects of the US market justify the investments, in spite of the prevailing uncertainty as regards the extension of the PTC scheme," says the company.

Ron Lehr, the American Wind Energy Association's western representative, says Vestas is looking beyond the PTC and at the strength of regulatory policy in state markets -- particularly Colorado -- many of which have laws requiring utilities to acquire rising percentages of power from renewable energy. Colorado recently increased its requirement from 10% to 20% by 2020. Its dominant utility, Xcel Energy, is bound by a minimum standard of 30%.

Xcel has documented the benefits of wind power in its generation mix. In a recent estimate, it found that its purchases from 1067 MW of wind plant cut its costly natural gas consumption for power generation by 20%. "These are dollars that stay with the consumer," says Lehr.

Colorado is also ideally located in the central West, sitting halfway along the strong wind corridor that runs through the centre of the United States. It is also close to the Panhandle region of northern West Texas, which is already one of the strongest regional markets for wind and is expected to grow more as new transmission lines are built.

The sheer size of the Colorado facilities will be a sight to behold, says Lehr. Vestas' existing blade facility in Windsor is about 37,000 square metres and the new blade facility will be equal in size. "These are like airplane hangers for 747s," says Lehr, referring to the jumbo jet airliner.

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