Siemens Energy, a wind energy equipment manufacturer, said yesterday it would lay off more than 600 employees in three states because of a downturn in orders.
The company said the drop off in orders is partially due to uncertainty about the federal Production Tax Credit, which is due to expire Dec. 31. The credit helps to finance wind turbine installations, and industry advocates say new wind projects have nearly ground to a halt because of its potential expiration.
In a prepared statement, Siemens said that uncertainty and “the current trend toward more natural gas based power generation due to record low natural gas prices and still lingering recession impacts on energy demand growth, are casting a shadow on the short-term future of the entire U.S. wind power industry.”
As a result, the company said the industry is facing a significant drop in new orders, and this has an “unfortunate consequence on employment in this segment of the power industry.”
The Fort Madison, Iowa plant took the heaviest blow, losing 407 jobs. Other cuts took place at plants in Hutchinson, Kan. and Orlando, Fla. The layoffs leave about 1,000 workers in Siemens’ wind power business in the United States.
Over the past five years, Siemens has invested $100 million in building its wind power production facilities in the United States. In that time, the company has grown to more than 1,650 employees who have been manufacturing, installing and servicing more than 3,900 wind turbines across the country, representing enough electricity to power more than 1.75 million average households.
The layoff will be the second in Iowa’s wind energy industry this year, according to newspaper reports. Clipper Windpower in Cedar Rapids reduced its workforce by 76 workers among its 300 employees in August.
Vestas Wind Systems, a Denmark-based turbine manufacturer, is also moving forward with about 2,200 layoffs globally.
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