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A wind turbine looms behind a farm east of Pipestone, Minn., in this May 24, 2006, file photo. New worries about the environment, technology advances and tax breaks extensions are empowering European wind energy companies to try their luck in the United States. The U.S. has led the world in installing new wind turbines for the past two years, but it still ranks behind Germany and Spain in wind power production. (AP Photo/Jim Mone, file) ( JIM MONE )

NEW INVESTORS JUMP INTO RENEWABLE ENERGY SURGE IN U.S.

By Alan Zibel
Associated Press
Article Launched: 04/27/2007 01:43:33 AM PDT

WASHINGTON – New worries about the environment, technology advances and tax break extensions are empowering European wind energy companies to try their luck in the United States.

The United States has led the world in installing new wind turbines for the past two years, but it still ranks behind Germany and slightly below Spain in wind power production, according to the Global Wind Energy Council. Now America’s renewed embrace of policies to encourage energy alternatives has led companies with years of experience in Denmark, Germany and Spain to invest in this country, challenging both the U.S. market leaders and environmental opposition to building giant turbines.

“We’re like the Saudi Arabia of wind, and we just haven’t had the big exploration boom yet,” said Michael Peck, a spokesman for Gamesa Corporacion Tecnologica, a Spanish company that makes wind turbines in Pennsylvania and develops wind farms around the country.

Two deals announced last month reflect the competition. Portuguese utility EDP Energias de Portugal agreed to pay $2.15 billion to buy Houston-based Horizon Wind Energy from investment bank Goldman Sachs, giving the company its first toehold in the United States. And Denmark’s Vestas Wind Systems, the world’s largest wind turbine maker, announced plans to build a $60 million blade factory in Colorado, its first U.S. manufacturing plant.

“The U.S. is a bigger area that (European companies) can look to for growth,” said

Thomas Emmons, senior vice president for structured finance at HSH Nordbank in New York.

On-again, off-again tax credits have hampered growth in the United States compared with a more stable climate for incentives in European countries. European companies are encouraged that a federal wind power tax credit has been extended through 2008, and 21 states and Washington, D.C., are requiring utilities to get electricity from renewable sources.

The U.S. gets less than 1 percent of its electricity from wind-powered generators compared with 20 percent in Denmark and 9 percent in Spain. Technology advances could push U.S. wind power use to 5 percent by 2010, the Electric Power Research Institute says. If the federal wind tax credit is maintained, annual installations of wind projects in the nation will more than double by 2011, predicts market research firm BTM Consult.

“We could have had our own homegrown wind-power companies competing for these new wind farm developments and manufacturing (plants) had we had the right policies in place,” said Ron Pernick, a principal with research firm Clean Edge.

Worldwide sales of wind turbines are projected to rise to $49.4 billion by 2011 from $25.1 billion this year, with the United States and Canada comprising about 23 percent of worldwide growth in wind power generation, BTM Consult estimates.

Vestas’ plant in Windsor, Colo., is expected to be complete early next year and is designed to produce 1,200 wind turbine blades per year, enough to power about 200,000 households.

Meanwhile, German industrial giant Siemens has taken a shuttered truck trailer factory in Fort Madison, Iowa, and turned it into a factory that makes 150-foot blades for its wind turbines. And Gamesa, which bought Minneapolis wind farm developer Navitas Energy in 2002, signed a $300 million deal last summer to make 132 wind turbines for Royal Dutch Shell’s wind development arm.

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