Near-record orders spur Vestas wind-turbine production and hiring
After a year in which Vestas Wind Systems slashed its Colorado workforce, wind-turbine orders reached near-record numbers in 2013 and hiring is on the rise.
Aarhus, Denmark-based Vestas has booked nine orders for 1,700 megawatts of turbines, with the potential for another 1,900 megawatts.
In the past week alone, the company announced four orders.
There are contracts for wind farms in Texas, New Mexico, Oklahoma and the Canadian provinces of Alberta and Nova Scotia.
In 2012, Vestas cut its Colorado workforce by 40 percent to 1,000 as orders dried up, across the wind sector, when the federal wind-production tax credit, or PTC, expired.
The tax credit, a key element in the financing of wind farms, was restored for one year in January, and that once again spurred orders.
The credit is equal to $22 for each megawatt-hour that a new wind farm produces in its first 20 years.
The PTC will again expire Wednesday — but this time things are different, said Chris Brown, president of Vestas’ sales and service division in the United States and Canada.
The orders Vestas has will stretch into 2015 and perhaps into 2016, Brown said.
“We have a longer runway because of the interpretation of what it means to start a project,” Brown said.
Under the last tax-credit program, a project had to be under construction before the end of the year to qualify.
In 2013, the U.S. Internal Revenue Service guidance has been more flexible.
A project qualifies if at least 5 percent of the costs are incurred in 2013.
A master supply agreement with a turbine company for which only part of the turbines are ordered in 2013 also counts, Brown said.
So while Vestas has orders for 1,700 megawatts, three of those on master supply agreements could add up to another 1,900 megawatts.
Vestas’ record year for American and Canadian orders was 2010, with 1,883 megawatts.
“We are looking at a longer cycle, and that is what you want as equipment makers,” Brown said. “You hire people and can offer them long-term jobs.”
Vestas has 1,300 manufacturing employees at its four Colorado factories: two blade plants, one in Windsor and one Brighton; a nacelles plant in Brighton; and a tower factory in Pueblo.
The company has announced that it will add hundreds of additional jobs but has not given give a precise number.
“The PTC will have continued benefits for wind-industry activity in 2014 even though the credit will expire,” said Sarah Cottrell Propst, executive director of the Interwest Energy Alliance, a trade group.
“The industry will continue to encourage Congress to take up comprehensive tax reform as quickly as possible to address the wind PTC,” Propst said.
Mark Jaffe: 303-954-1912, email@example.com or twitter.com/bymarkjaffe