The jewel of the crown of Portland's fledgling renewable energy cluster of companies may be gone with the wind. Vestas is expected to be sold to the Chinese energy conglomerate Ming Yang. Portland taxpayers have been on the hook for at least $10 million of dollars in giveaways to the company. In return, the company was to bring 1200 jobs to the City. The millions are gone. The jobs promises which taxpayers were told would pay for the freebies were only fractionally fulfilled. Sound familiar? Reports and rumors have abounded for weeks about the acquisition of the company, but a source told me this overture seems to be even more serious this time and the wind industry --and "the street"--have taken note. Vestas financiers have been after the company to court suiters because American federal and local tax payer subsidies are winding down.
Portland and the state of Oregon have tried to prop up the renewable industry with millions in loans, grants and subsidies. The federal production tax credit subsidies of 2.2 cents per kilowatt hour will run out at year's end. And now Vestas' financiers want the company to be gone, too.
In addition to $10 million in enticements to come, Vestas originally was to be given an $8.1 million dollar no interest taxpayer loan as an enticement to stay (it already was leasing space) and do a $66 million refurbishment of a new building for its headquarters. In a switcheroo, that $8.1 million "free loan" (taxpayers are on the hook for the nearly $3 million in debt service) went to developer Gerding Edlen. The Portland Development Commission moved heaven and earth, breaking its own rules in the process, and now Vestas' North American Headquarters sits in the newly refurbished Meier and Frank warehouse at 15th and NW Flanders.But since the freebies are gone, it appears so is Vestas. Vestas is expected to build out existing wind farms for the rest of 2012. No new plans are drawn up for build outs in 2013, after taxpayer subsidies run out.
Vestas certainly is looking like a takeover target. In January it laid off 2335 workers 182 in n America. The Colorado headquarters may lay off 1600 workers.
But if Vestas goes will they stay? They want the freebies too. Moventas supports the wind industry, for instance. They're not likely to stick around if there's little to support.
And once again, the central planners look as if they've biffed it again. Picking winners and losers is what the market does best. Occupy Portland, take note, this is what privatizing the profit and socializing the loss looks like. Margaret Thatcher famously said, "The problem with socialism is eventually you run out of other people's money." This is what that looks like, too.
Ok... I need to calm down.. otherwise I will have a Heart Attack....
ReplyDeleteyou mean to tell me when I go home to see my mother in the assisted living home in Hermiston.. all those windmills on the both sides of the river just past Cellio Falls.. are going to be owned by a Chinese Company?
I say put those windmills in every place around Portland.. its TIME that the environmentals in this area get to see just what it is to "push wind energy" to see what it looks like. People in this town go into a tizzy about Cell Phone Towers.. Imagine a Windfarm Tower in your neighborhood!
Portland and Portland City council (I would venture to say Salem too) has a habit of saying "we want this in this state:.. by basing everything around the PDX area.. and building boondoggles outside the area in some other cities backyard. Now.. owned by Chinese Corporations... Maybe that is what they planned all along..
No, Vestas doesn't own any of those turbines. In fact Vestas doesn't own any turbines at all. They are a turbine manufacturer. They sell them and install them for their customers. None of this implies Chinese owned wind turbines. I'm not even sure the US government would allow the Chinese to own a piece of "the grid."
DeleteHi kitanis,
ReplyDeleteSometimes it almost seems like they did plan it this way. Almost 400 million in Oregon tax credits to produce electricity at 6 times the market rate. I suspect in about 10 years, they can lease the area out as a filming place for post apocalypse movies. With luck, the Chinese will buy it and get taken to the cleaners like the Japanese did in the early 90's bying unprofitable, but highly publicized US assets.
Once your nitroglycerin kicks in, go to www.portlandonline.com and read the new 25 year plan for Portland. More of the same fantasy growth in what are called "traded sectors". Last weeks Oregonian explained what they are, services done elsewhere we manage or kibbitz on for a cut of the take. I think they used to be called middle men. For some reason, the rest of the world is going to come to Portland to hire consultants, lawyers, advocates, regulators, facilitators, bureacrats, planners and networkers (you know, working class people) to show them how to be more like Amster..., er Portland. A city full of Oregon's own Horatio Algers, Cylvia Hayes. The CRC is a perfect example of how $150 millioin dollars was paid out to such people for exactly nothing in return to the public.
You see the same schizophrenic thinking re the opposition to LNG terminals and coal trains. Oregon shouldn't be an be exporting energy to others without thinking what if all the places that export energy to Oregon had the same philosophy.
Portland has a serious case of delusions of grandeur about it views itself. The city and this state produces little of what it desires while priding itself on beiong one of the most "sustainable" places on Earth.