Just something to keep your eye on as your politicians promise you that the US will be the world leader in green tech jobs.  In fact they have to layer countless more debt on your children and grandchildren for temporary jobs, to make this dream come true.  Most likely this promise will come next spring as the next massive stimulus hits to create green jobs retrofitting buildings and such.  Meanwhile, ask where the production is and what work we will be left with after we borrow money from China to create temporary jobs.  [Nov 2, 2009: Lack of Green Energy Manufacturing Capability in US Means 84% of Stimulus Goes to Foreign Firms]

Remember, Japan and Germany are a decade ahead of us... and China is subsidizing every form of green energy.

  1. [Aug 25, 2009: UK Telegraph - China Powers Ahead as it Seizes the Green Energy Crown from Europe
  2. [Aug 28, 2008: China to Subsidize Wind Turbines
  3. [Jun 19, 2009: Reuters - Incentives Add Shine to China's Solar Drive]  

Just today I saw two separate Chinese firms (both of which we've owned in the past) pledging to build plants in the US as political cover... Suntech Power (STP) in solar and A-Power Energy (APWR) in wind.

  • Gov. Jan Brewer on Monday announced plans for a Chinese-owned solar panel maker to build its U.S. headquarters and a manufacturing plant in the Phoenix area, propelling one of the nation's sunniest states toward a bigger global presence in the renewable energy industry.  Suntech Power Holdings Co. said it expects to start building photovoltaic panels at the facility by the third quarter of 2010. The company, which has more than 9,000 employees, expects to eventually employ 250 or more people at the plant.

By doing so, they can clap up and down they are creating jobs (hundreds!) in the US - collect money from the federal government (which in reality is their own government's money, just passing through the US government after we borrow it) while 99% of the production is back in the home country.  But hey we get some assembly jobs here, and some great photo opportunities for some governors.

  • With the capacity to make 30 megawatts of solar panels per year, the Arizona facility would represent about 3 percent of Suntech's total production, Bachman said.

If you are not familiar with the solar industry in China - there are literally over 100 of them.  Suntech is their largest fish, but again its 3% of their production; i.e. equivalent to 1/10th of one of Suntech's countless smaller competitors.  But again, a wonderful photo opportunity... to be frank it is a genius move by the Chinese; sort of a Trojan Horse theory.

  • They want to appear to be manufacturing here domestically so when the solar market takes off in the U.S., they have room to stand on and say, 'We are producing jobs here and we want to be able to sell our panels here as well,' Bachman said.

As for US solar companies?  Last I checked out best firm, First Solar (FSLR) was moving as much production as possible to Malaysia.

Now in wind - A-Power, which was the source of the controversial story I highlighted in early November, has decided it would make for good press to build a plant in the US too.  It is nice that Chinese companies are offering some scraps to the Americans...

  • China's A-Power Energy Generation Systems (APWR) has signed a cooperation agreement with equity firm U.S. Renewable Energy Group (US-REG) to build a plant in the United States to supply wind energy turbines to renewable energy projects in North and South America.
  • The joint announcement in Washington late on Monday came three weeks after A-Power said it planned a $1.5 billion wind farm project in West Texas along with U.S. companies. 
  • It will employ about 1,000 workers and create additional jobs during construction, the companies said.

Convenient timing; I'm sure central command back in Beijing did not like the original backlash to the New York Times story and A-Power got some assistance from their government in making this decision. ;)  So all in all 1250 jobs and I'm sure grand promises of many more to come (ahem).  If you divide those 1250 jobs times all the assistance from US federal government I am sure it will akin to the cost per job created or saved from the current stimulus - perhaps $1-$2M a head?

I actually thought about 2 years ago the one thing the US could grow dramatically in the manufacturing base is the production of wind turbines (for domestic usage) they are so heavy, transporting them across oceans would be prohibitive, but ... I guess that thesis was wrong.

Meanwhile a lack of any sort of long term industrial policy continues to make the US look the fool... but it would be socialist to plan out 10 years in America.  That's best left to Germans.  Dogma baby.

Anyhow back to the Chinese... via USA Today:

  • China leads the world in making solar cells, the key component in solar panels, many of which are exported to the U.S.  But China is setting itself up to do more than just manufacture components for renewable energy, such as wind and solar. It's also spending heavily to build its own domestic market as it attempts to battle its greenhouse gas emissions, electrify its nation of 1.3 billion people and curb its massive pollution problem.
  • The buildup of a huge market in China for renewable energy is luring global manufacturers and research teams to China, energy executives say. (hmmm, I thought that was supposed to be happening here instead
  • That's causing concern in some corners that China – not the U.S. – will emerge as the hub of the new industries, leaving the U.S. as dependent on foreign nations for solar panels, wind turbines and other green-energy equipment and technology as it is on the Mideast for oil.  (why not? dependence on others has been working like a charm the past quarter century.  Anyhow my politicians promise me that this will not, and can not happen.  I believe drill baby drill! is the way forward to new industries, right?)
  • The Chinese government has recognized that these industries are the 21st century's industries of importance, and it wants to be the Silicon Valley of renewables, says Alan Salzman, CEO of U.S.-based VantagePoint Venture Partners, which specializes in clean energy and clean tech investments.  (all government is evil, says right here in my dogma book - this obviously will fail as all things in China have the past 15 years... err)

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