United States

United States

Election - Bleak jobs picture in run-up to November poll

UNITED STATES: Job losses in the US wind industry are unlikely to change support in Congress for the federal production tax credit (PTC). Most layoffs are in constituencies represented by lawmakers who already back PTC extension.

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The layoffs, however, could make a difference in the general election on 6 November. A significant number of axed jobs have been in the swing states of Colorado and Iowa, where the vote could be close.

An analysis by specialist news service Greenwire and Windpower Monthly cross-referenced the location of plants with publicised redundancies and whether the local member of the House of Representatives' has voted for a PTC extension in key bills.

In all but five cases, the representative has not only backed an extension but has been vociferous enough on the issue to have either co-sponsored legislation or co-signed a letter seeking an extension beyond 31 December. The fight has been more heated in the House of Representatives, where conservative Republicans have blocked action, than in the Senate.

The connection between politicians and wind layoffs is not surprising, said Nancy Pfund, managing partner of venture capital firm DBL Investors and an expert on investing in clean technologies. "The more constituents in a state (in a particular sector), the more political advocacy you're going to have," she said.

Bipartisan support

In addition, such advocacy is politically expedient for the lawmakers seeking votes, said Pfund. Green jobs can be contentious in political debate in Washington DC, but are far less so in the rest of the US, she added.

A common misconception is that support for green jobs comes mostly from Democrats. But it is bipartisan, especially in the Midwest, according to a report co-authored by Pfund, published in September. The report notes that many US state governors who support green jobs most ardently are not only Republican, but are prominent members of the party.

However, the Republican figurehead, presidential candidate Mitt Romney, is opposed to a PTC extension.

"Increasingly, we found that governors were doing the right thing for their state, such as attracting green-tech businesses," said Pfund. "They take a very pragmatic approach - and you could extend that argument to other political figures."

Some 81% of US installed wind capacity is in Congressional constituencies represented by Republicans, according to the American Wind Energy Association (AWEA).

The issue of jobs in the wind industry has been high profile in the presidential campaign. Romney's energy policy paper, released in August, claims that the US wind industry has shed 10,000 jobs since 2009, when President Obama took office. Romney's campaign did not respond to questions about the source of these figures.

Sharp drop

However, AWEA's figures seem to match Romney's or paint an even bleaker figure. According to the association's vice-president of communications, Peter Kelley, employment in the industry peaked in 2009 at about 85,000, when 10GW was being installed. Since then, the recession, cheap natural gas and PTC uncertainty have taken hold. By the start of 2012, the number of jobs had dropped to 75,000.

AWEA only systematically collects jobs figures once a year, but as of mid-September, employment in the industry was estimated to stand at some 70,000 because of a decline in development and manufacturing and an imminent decline in construction, said Kelley.

AWEA has frequently claimed that the industry will lose 37,000 jobs in 2012 and the first quarter of 2013 if there is no extension to the PTC.

Job creation potential

An analysis released in September by grassroots environmental action group the Natural Resources Defence Council (NRDC) found that, on average, a new 250MW wind energy project in the US will create the equivalent of 1,079 full-time jobs over its lifetime, with about half in construction.

The NRDC calculation was based on the total hours of work needed for the wind project at the site and throughout the supply chain. It does not include jobs created by broader economic activity spurred by the industry.

Phil Jordan, a consultant at BW Research who worked on the study, noted that anxiety over layoffs is rife in the industry. As Scott Viciana of turbine tower maker Ventower said during a conference call organised by NRDC: "It keeps me up at night. It's a real tangible threat. I hope we can keep afloat."

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