China Invests in West Texas Wind Farm

Posted by: Frederik Balfour on November 2, 2009

Late last week, a Chinese-U.S. consortium announced it was building a 600 megawatt wind farm in Texas costing $1.5 billion. The deal, in which the Chinese partner is putting up 49% of the cash, stipulates that the wind turbines, about 240 of them, will be manufactured in China by A-Power Energy Generation Systems, a mainland company located in Shenyang. A-Power is the majority investor in Shenyang Power Consortium that is participating in the Texas facility.

A New York Times blog about the deal provoked a number of comments from U.S. readers upset that the project would generate more jobs overseas than at home, a particularly vexing notion given that the project is seeking 30% of its financing from Washington stimulus funds. But what a lot of readers overlooked [though the Times did not] was that A-Power is listed on Nasdaq. Remember that ordinary Chinese are not allowed to invest in overseas stocks, so while jobs may be created in China, the profits will accrue to U.S. and other international investors in A-Power. [Its stock traded up 15% Oct. 29 on the news]. Other Nasdaq-listed Chinese renewable energy companies include solar panel makers Suntech [STP] and Trina Solar [TSL] which have made strong inroads into the U.S.

But it’s not just the Chinese who are gaining ground in the U.S. renewable energy sector. At the end of 2008, Indian wind turbine maker Suzlon Energy had 10% of the U.S. market. Though it built a $25 million dollar rotary blade factory in Pinestone Minnesota employing 400 people, [the economics of wind power dictate that blades be manufactured close to market] the more costly turbines are made in India. More telling perhaps of the realities of globalization in the renewable energy sector: all engineering and research work is also done in India.

That reminds me. While writing a story about U.S. investment in Southeast Asia, I noted that Tempe,Arizon-based First Solar [FSLR] is building a $680 million solar panel factory in Kulim, Malaysia. The company denied my request for an interview or for a response to written questions, leaving me to conclude it was not keen on publicity about its offshore investment. The most recent mention of the investment appearing on the company website was a 2007 press release.

An alert reader pointed out to me that First Solar in September signed an memorandum of understanding with China to build a 2-gigawatt solar power field, perhaps becoming the world’s largest such facility, sprawling across an area in Inner Mongolia [a province that is also heavily into wind-powered energy also a huge wind farm area] larger than Manhattan. Here’s some info from the company’s website.

Here’s another intriguing U.S. company, Check out this interesting piece in the latest BusinessWeek magazine by my colleague Adam Aston about a new wind turbine under development by FloDesign in Wilbraham (Mass.)Its prototype designs incorporate features used in jet engines instead of the traditional propeller-type blades in use today.

Reader Comments

hao

November 2, 2009 7:32 AM

I feel that the industry of renewable energy is growing rapidly,it will surely be the most potential part of the maket in globalization.

Rory Marsh - Jamaica

November 2, 2009 8:44 AM

The only people who do not like the idea of renewable energy are the big boys that play inthe oil game.

It makes perfect sense to invest in clean renewable energy. The challenge is to get the set up costs down so that developing countries can begin to take advantage of the various types of renewable energy.

Rory Marsh - Jamaica

Squeezebox

November 2, 2009 9:01 AM

I think a piece elsewhere on this website told about Dyson's latest invention - a desk fan without blades. If this technology were somehow put in reverse, I wonder how good Dyson would be at capturing wind energy?

Bill, Kalamazoo MI

November 3, 2009 10:05 AM

China in Texas, China off our shores drilling oil in FL, China in our auto showrooms, China in on our backs, on out feet and in our stereo cabinets. I don't know when we as US citizens will wake up. It is all fine and dandy for "developing" nations to want their version of the American dream but i argue not at the expense of America or more to the point the American taxpayer. If China wants to play here they can at least pay full price. If Americans don't but America first I don't think anyone else will for sure. Wake the he@@ up!

jim

November 3, 2009 2:40 PM

@ Bill, if u have deep enough pocket to shell out 49% of the initial cost of this project, u may do so immediately. Bottle line is: We have no money, and the Chinese do. Regarding drilling oil in Gulf of Mexico, numerous European nations are currently doing it, such as: UK, Spain, France, the Netherlands, etc. It is old news. China is a very late comer.
Remember, American and European companies have been drilling in Middle East and Africa for the last 100 years.

Wind4me

November 3, 2009 5:09 PM

as U noted, why NOT invest into APWR and profit since APWR is the china player in Wind power and this 1.5 billion wind farm is just one part of a multi part China Clean Energy player

http://www.Wind4me.com

I have studied APWR for years and its my MAIN HOLDING in my Wind Research Blog

Jeff

November 3, 2009 7:13 PM

@Bill, Kalamazoo MI
Bill, why get so worked up about the Chinese investment? Isn't it a bit hypocritical to accept Chinese money with no questions asked when it is in the form of US treasury purchases but cry foul when the Chinese dare to make alternative forms of investment? The so-called federal stimulus money involved in this project in all likelihood came from the Chinese anyhow, so realistically, this is a 100% Chinese-funded project to help us wean off the oil addiction. I see no problem with that. Moreover, I am quite happy for China to diversify its investment here, away from useless treasuries (i.e. fancy paper) to more concrete projects such as this wind farm deal. Let's face it: we have not been exactly wise with the money borrowed from China, have we? Instead of using the 1.2 Trillion dollars the Chinese have lent us on things such as upgrading our power grid, repairing our faltering infrastructure, and upping our spending on basic R&D, we blew all of it on two endless wars, flipping houses, Wall Street bailout/compensations, and a bunch of other silly stuff. If the Chinese can better spend their hard-earned money than we can on their behalf, then more power to them. We, on the other hand, need to stop being a bunch of crybabies.

C. H. Ng

November 3, 2009 10:52 PM

@Bill.. I could not but totally agreed with both Jim & Jeff; you seemed to be like one of the many Americans who simply cannot accept the real fact that your country has passed its glory & the road to recovery cannot suceed if people like you are still living in your so-called dreamland.
Wake up man, the world is changing & the seat of power has shifted slowly but surely in another direction.

C. H. Ng

November 4, 2009 12:32 AM

@ Bill :-

By the way I thought you were asking your fellow Americans to wake up but instead it seems like you are still asleep. The people who had already woke up and realized their country's follies are people like Jim and Jeff.
They are the ones who will make your country stand back on her feet again soon.
As for you, you can still go back to sleep and dream on..........!

sophgold

November 4, 2009 1:38 AM

It is too early to say that America has passed its golden years.In fact, the so called "crisis" is much more worse in other countries, including China. Although China's the economic data seems like very good(As you known,China's economic statistical data is always unbelievable good,the Statistical Bureau of China has long lost its credibility), the real scenes in China are quite different.More than 70% of college graduates of 2009 have not found a job yet.Private sectors suffered great losses,too. Investment has contributed a great part to China's GDP in past years,it make up more than 50% of GDP of China in 2009, or almost 90% of the economic growth in China.The crazy investment growth usually dominated by government.the impetus for projects under construction most are simply from government's instuction,not the real demand from the market.Wastes and corruptions in these projects are astonishing.They can make good economic figures ,but can't make a sustainalbe economic future for China.

Shunjing

November 4, 2009 3:00 AM

@ ch ng .A lot of malaysian chinese complained when mainland chinese compete for their jobs. Its natural.

Frederik Balfour

November 5, 2009 1:06 AM

An alert reader pointed out to me that First Solar in September signed a memorandum of understanding with China to build a 2-gigawatt solar power field, perhaps becoming the world's largest such facility, sprawling across an area in Inner Mongolia [a province that is also heavily into wind-powered energy also a huge wind farm area] larger than Manhattan. Here's some info from the company's website.

C. H. Ng

November 5, 2009 2:15 AM

@ Shunjing:

Oh no, you are wrong Shunjing...It's not us Malaysian Chinese (or any other Malaysian race) who are complaining about mainlander Chinese competing for our jobs but the Singaporean.

Only Malaysian Chinese women are complaining about the influx of the so-called "Dragon Ladies" from China who are "competing" for their husbands' attention and money. You can check the fact and it's a very well known & serious case not only in Malaysia but also in countries like Thailand & Singapore.

wind4me

November 25, 2009 10:54 PM

quite the call and run on APWR in a weeks time since this story broke

http://www.Wind4me.com

m. max

December 7, 2009 7:09 AM

how bout figuring out how a disable usa citzen can aford a solar power combo to cut his power consuming home down to a half and find away for me to be able to pay for it cause asking the goverment for help here is a joke n nothing but red tape and stupid form out the behind no jokes or puns intended

bobby

February 12, 2010 5:05 PM

What about after China nationalizes the manufacturing facilities? Who ownes the company then?

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