Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
hold back because of the PTC mess. The PTC is the tax credit that supports wind projects in the USA. It's only renewaed for a year or two each time, which ensures that their is a certain market in the US for only 2 years at most. And PTC renewal was a mess in the recent past, and was delayed in several instances, resulting in years with almost no construction of wind farms in the US in 2000, 2002 and 2004:

That really hurt the turbine manufacturers in the past - first by keeping some brand new factories idle after they invested to cover expected demand, and then by making them rush the next year to cover extra orders, and having supply and quality problems. Both things made them lose money, and the industry was really, really hurt in 2004-05.

So turbine manufacturers will underinvest as long as the PTC is not renewed for longer than a couple of years, which doesn't look like it's happening this time round, again.

In the long run, we're all dead. John Maynard Keynes

by Jerome a Paris (etg@eurotrib.com) on Mon Dec 3rd, 2007 at 05:04:45 AM EST
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There are even instances where manufacturers closed assembly or blade facilities when the PTC died out.  I believe Micon suffered as well as Vestas, which led to Micon's downfall and resultant purchase by Vestas.  The boom and bust cycles affect affect the entire supply chain, for example when tower manufacturers open and close.  The end result is the absence of economies of scale and long-term infrastructure investment planning.

The PTC currently expires at the end of 2008, and significant Capex has already been made.  Most analysts had no worries of an extension until recently.  There was talk of decoupling renewables from the contentious energy bill, where the dinosaurs are fighting it out.  Several days ago Pelosi announced that there was some kind of agreement bringing renewables back into the mix, but that remains to be seen.  Since there is general bipoartisan support for the PTC it's hard to imagine it wouldn't be extended, but i've seen weirder things happen around energy policy in amurka.

AWEA was going for a 5 year extension, and i believe at least 3 years can be counted on.  But the risk of no extension has surfaced over the past two months.

"Life shrinks or expands in proportion to one's courage." - Ana´s Nin

by Crazy Horse on Mon Dec 3rd, 2007 at 08:09:32 AM EST
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The boom and bust cycles affect affect the entire supply chain, for example when tower manufacturers open and close.

I understood that there has been steady demand these past few years, worldwide I mean.  Have I got that wrong, or was/is there a reason why US manufacturers aren't in the export business?

Don't fight forces, use them R. Buckminster Fuller.

by rg (leopold dot lepster at google mail dot com) on Mon Dec 3rd, 2007 at 08:15:21 AM EST
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