Vestas Wind Systems trims about 200 more Colorado jobs

Source: By Steve Raabe, Denver Post • Posted: Friday, October 12, 2012

Wind-turbine manufacturer Vestas Wind Systems made its largest Colorado job cut Thursday, laying off about 200 workers at its Windsor blade plant.

The cuts represent 29 percent of the plant’s workforce. Vestas also had laid off workers at plants in Brighton and Pueblo.

Vestas cited a decrease in wind-turbine orders stemming from the looming December expiration of a federal tax credit on electricity generated from wind.

The tax credit is a hot political issue that figures to define a portion of the presidential campaign. President Barack Obama and many Democrats support it; challenger Mitt Romney and many Republicans oppose it.

Vestas, based in Randers, Denmark, has been a key player in Colorado’s effort to become a leader in renewable-energy research and manufacturing.

But that effort has sustained some major losses in recent months. Loveland-based Abound Solar closed its solar-panel plant and filed for bankruptcy liquidation. General Electric’s Primestar Solar has postponed development of an Aurora manufacturing plant that was to employ 355 workers.

The solar industry has been hit by the plunging price of Chinese-made solar panels. However, problems facing wind power stem mostly from the looming expiration of the production-tax credit, or PTC.

A move to extend the PTC is likely to be considered in Congress before the end of the year.

Economic-development officials have said that Vestas layoffs could have a ripple effect on the company’s suppliers and vendors in Colorado, which include Hexcel Corp., Bach Composite and Great Western Railway. The wind-power industry employs about 5,000 workers in Colorado.

“Congress’ failure to quickly extend the PTC is pushing this promising industry backwards, costing hard-working Coloradans their jobs,” U.S. Sen. Mark Udall, D-Colo., said in a statement. “Nonetheless, I remain committed to working with colleagues from both sides of the aisle to immediately extend the PTC as soon as Congress returns to Washington.”

Opponents of the tax credit say wind power should compete on an unsubsidized basis with other sources of electricity.

“The wind subsidy, which was supposed to be temporary, continues to be a waste of taxpayer dollars,” U.S. Sen. Lamar Alexander, R-Tenn., said in a recent statement. “Over the five-year period ending in 2013, taxpayers will have spent $14 billion to subsidize wind developers, money that could be spent to reduce the debt or for energy research.”

Thursday’s layoffs follow an announcement this week of 75 workers fired at the Vestas blade factory in Brighton. Vestas previously had eliminated 30 jobs in Brighton and 90 at its tower factory in Pueblo.

The combined layoffs, plus some attrition and relocations, have reduced Vestas’ Colorado workforce from 1,700 to 1,200 this year.

While wind is still a relatively small part of the nation’s power mix — about 3 percent of the electricity generated in 2011 — it is growing fast. About 35 percent of all new generation capacity added over the past five years comes from wind power, according to the American Wind Energy Association.

“Over the long term, failure to extend the PTC could damage U.S. competitiveness in the renewable-energy sector,” said Sarah Cottrell Propst, executive director of the Interwest Energy Alliance, an advocacy group for renewable energy. “Tens of thousands of jobs in the first quarter of 2013 are at risk if Congress fails to extend this important policy.”

Navigant Consulting has predicted the wind-power industry could lose about half of its U.S. jobs — 37,000 out of 75,000 — if the PTC is not extended.

Matt Kaplan, a wind-energy analyst for consulting firm IHS, said wind-farm developers are hurrying to complete projects this year in anticipation of the PTC expiring.

“The looming expiration of the production-tax credit is leading to a boom in 2012 wind installations,” he said. “We forecast that the boom in 2012 will be followed by a bust in 2013, with wind installations dropping 80 to 90 percent.”