Given the long term slide in U.S. manufacturing, it’s no surprise that the domestic wind turbine industry has some catching up to do. In fact, right around this time last year, a bit of a brouhaha erupted when Recovery Act funding was made available to build U.S. wind farms using turbines shipped in from overseas. However, the American wind industry has been stepping up its game, and American manufacturers are poised to get a big boost from the current spike in oil prices.
Shipping Costs and Wind Turbines
Until recently, overseas manufacturers had the competitive advantage. But U.S. manufacturers are finding that overseas shipping expenses are a big enough factor to give domestic production an edge. Though many parts are small, the core features of wind turbines are enormous, heavy pieces that are costly to ship long distances. Last year, Michigan attracted its first large wind turbine manufacturer, North Power Systems, which uses made-in-America parts. Not to be outdone, the company Aeronautica Windpower has gotten third-party certification for its made-in-America cred. That kind of thinking is also motivating overseas companies to build wind wind turbine factories in the U.S.
Shipping Costs Going Up, Up, Up
The rising price of fossil fuels is the key factor in driving consumer demand for alternative energy, and it can also help give domestic wind turbine manufacturing a boost from behind, too. The vast majority of global shipping is conducted over water, by container ships that mainly use a low grade of oil known as bunker fuel – and bunker prices have been quick to rise along with the price of crude. Though the shipping industry is transitioning to better fuel efficiency and even the use of alternative energy such as wind power, it will continue to rely on bunker for years to come, and the competitiveness of U.S. wind turbine manufacturers will continue to improve with every upward tick.
Image: Statue of Liberty by Celso Flores on flickr.com.