Nevada, Iowa woos Chinese energy firm partners?

Source: Dan Piller, Des Moines Register • Posted: Thursday, April 19, 2012

NEVADA, IA. — Folks here were happy enough when HZ Windpower of Chong-qing, China, dedicated two 2-megawatt wind turbines Wednesday, but the locals have their eye on a much bigger prize.

HZ is looking for a site in the U.S. to build blades, towers and other components for wind energy. Nevada, whose motto is “Where Renewable Energy is Happening,” thinks it is just the spot for an HZ plant and laid out a welcoming lunch for the company’s officials at Indian Creek Country Club.

LaVon Schiltz, executive director of the Nevada Economic Development Council, noted that Nevada already is home to one ethanol plant, Lincolnway Energy, and a second, DuPont’s planned cellulosic ethanol plant, will break ground later this year.

“We have the land for any facility HZ wants to build,” she added.

The president of HZ Windpower, Yang Benxin, didn’t discourage such speculation.

“We are planning for investment in the U.S.,” Yang said before a brief ribbon-cutting ceremony at the turbine site southwest of Nevada. In his talk later to local dignitaries at Indian Creek, Yang said: “From now on we will use practical actions to express our sincerity.”

“Local governments make preferential policies for wind development, which would be an excellent opportunity to enter Iowa,” he said.

Schiltz said Nevada would offer incentives to HZ for a production plant.

The turbines used for the Nevada project were subcontracted by an Arkansas company, but the towers were built in China.

Other Chinese-built components have shown up in Iowa wind projects through the years, but the Nevada project is believed to be the first in Iowa to be owned and operated by a Chinese entity.

China is the world’s largest wind energy market, with about 60,000 megawatts of installed capacity (vs. 49,919 megawatts in the U.S.), and the country is looking for overseas opportunities.

“We first have to build up sales in the U.S. before we can think about a production facility,” said Curt Sherer, vice president of HZ’s American subsidiary, Goodwind Energy.

The Story County project had been in the works for two years, but HZ’s interest in Iowa got a boost in February when Chinese Vice President Xi Jinping visited the state.

Yang noted in his post-ribbon-cutting speech that Xi expects “to enhance the cooperation in new energy exploration such as wind power.”

China has emerged as a major builder of wind projects as that country has hit the limits on what its environment can tolerate from coal-generated electricity.

Wind energy interests in Iowa and the rest of the U.S., meanwhile, are sweating out the possible end of the federal 2.2-cent-per-kilowatt-hour production tax credit, due to expire at year’s end unless extended by Congress.

“Wind power will go to virtually zero next year if the (tax credit) is not be renewed,” Lewis Hay, chairman of NextEra Energy, which is Iowa’s second-largest wind energy operator after MidAmerican Energy of Des Moines, said Wednesday.

Harold Prior, executive director of the Iowa Wind Energy Association, has warned that loss of the tax credit would threaten many of the estimated 4,000 wind energy jobs in Iowa.