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Iowa cash lures turbine supplier -- Acciona picking US location

Spanish wind company Acciona is poised to announce the location of its first US manufacturing facility to produce the company's 1.5 MW wind turbines at a rate of up to 400 units a year. The company currently has two manufacturing facilities in Spain and one in China.

The location for North American manufacturing has been narrowed down to a choice of two: an undetermined locality in northern Illinois (rumoured to be Galesburg) and West Branch, Iowa, where a large facility owned by an industrial manufacturer, Sauer Danfoss, has sat empty and idle since 2003 when the company shifted its workforce elsewhere. The buzz around the West Branch location reached a fevered pitch last month after a strong incentive package, well over $2 million, was approved by state and local economic development agencies in an effort to court the company to the small Iowa town.

No evidence of a similar incentive package from state or local agencies in Illinois has emerged, according to Rob Poggenklass, editor of the West Branch Times. "The next step [for Acciona] is to talk with Sauer about purchasing, that's the only barrier left," says Poggenklass, who had followed developments closely. "You can't say this is final but Sauer is going to want to move that building."

Five a week

Adrian LaTrace of Acciona's North American wind energy division spoke at a West Branch town meeting saying Acciona is interested in buying the Sauer-Danfoss facility and retrofitting the building. The facility would employ 110 workers and be up and running by November. LaTrace expects it could ship five completed turbines a week. One or two turbines would be erected at the factory, which LaTrace said would be good for marketing and training. He added that Acciona likes the building because it fits many criteria and that Acciona has "entered into an agreement with Sauer but not a definitive purchase agreement." Both Acciona and Sauer-Danfoss decline to comment.

The economic incentives made available to Acciona for the West Branch facility are considered a key motivator. As well as a $2 million float loan from the Iowa Economic Development Board, a $500,000 investment is on offer from the Community Economic Betterment Account, plus $350,000 from the Physical Infrastructure Assistance Program. Tax benefits from a jobs creation program are also part of incentives.

Incentive bait

"I think both the city and state went way above and beyond what we expected," says Jackie Barten with the Cedar County Economic Development Commission, which was involved in arranging some of the incentives. "I heard $750,000 but now it's $2 million. What they awarded was well over normal. [The state] really wants this project to come to Iowa." She suspects talk of an Illinois facility has more to do with the realities of deal making. "Whenever you have businesses come in -- and we have this happen with out of state businesses -- they will leverage what they can get from you and they will say what they can get from someone else."

Acciona, a major wind power developer as well as turbine supplier, mainly active in Spain to date, has no wind power project assets in the US but has some minor assets in Canada. Acciona's North American division reports 256 MW of wind power in development in North America. LaTrace told the West Branch town meeting that the company is looking to install a 180 MW wind plant in North and South Dakota.

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