Feb. 9, 2010— -- Despite all the talk of green jobs, the overwhelming majority of stimulus money spent on wind power has gone to foreign companies, according to a new report by the Investigative Reporting Workshop at the American University's School of Communication in Washington, D.C.
Nearly $2 billion in money from the American Recovery and Reinvestment Act has been spent on wind power, funding the creation of enough new wind farms to power 2.4 million homes over the past year. But the study found that nearly 80 percent of that money has gone to foreign manufacturers of wind turbines.
"Most of the jobs are going overseas," said Russ Choma at the Investigative Reporting Workshop. He analyzed which foreign firms had accepted the most stimulus money. "According to our estimates, about 6,000 jobs have been created overseas, and maybe a couple hundred have been created in the U.S."
Even with the infusion of so much stimulus money, a recent report by American Wind Energy Association showed a drop in U.S. wind manufacturing jobs last year.
Sen. Chuck Schumer, D-N.Y., called the flow of money to foreign companies an outrage, because the stimulus, he said, was intended to create jobs inside the United States.
"This is one of those stories in Washington that when you tell people five miles outside the Beltway, or anywhere else in America, they cannot believe it," Schumer told ABC News, "It makes people lose faith in government, and it frankly infuriates me."
Matt Rogers, the senior adviser to the Secretary of Energy for the Recovery Act, denied there was a problem.
"The recovery act is creating jobs in the U.S. for American workers," said Rogers, "That is what the recovery act is about, that is what it is doing. Every dollar from the recovery act is going to create jobs for the American workers here in the U.S."
How Did This Happen?
Several of the large European turbine manufacturers had limited manufacturing facilities in the United States, but there was nothing in the stimulus plan that required that the turbines, or any other equipment needed for the wind farms, be made here, said Rogers. There are strict "Buy America" provisions in the Recovery Act, but this Green Energy Stimulus initiative turned the existing tax credits into cash grants, bypassing the "Buy America" provision.
Iberdrola, one of the largest operators of renewable energy worldwide, is based in Spain and has received the most U.S. stimulus dollars -- $577 million. It buys some of its turbines from another Spanish manufacturer, Gamesa, which has a U.S. connection. Gamesa has two facilities to manufacture turbine blades in Pennsylvania, but the company said the market forced it to temporarily lay off nearly 100 workers.
Eric Sheesley was one of those laid off from the Gamesa plant before Thanksgiving. "When we're employing other countries, we can't feed our kids at home. It gets hard you know." Sheesley had a glimmer of hope when a letter arrived this week telling him to report back to work next week.
One reason so much money is going overseas is that there is not much of a wind power industry in the United States -- only two major American manufacturers make wind turbines: General Electric Energy and Clipper Wind based in Carpinteria, Calif. Even those companies do a significant amount of their manufacturing overseas. General Electric told ABC News that GE's Renewable Energy business has 3,000 employees around the world, 1,350 here in the United States.
Schumer said the way to revitalize the domestic wind power industry and to create green jobs is to require that at least some of the turbine equipment to be made in the United States.
An American Farm With Chinese Jobs
Perhaps the most controversial wind project is one that has yet to receive stimulus money.
A Chinese company called A-power is helping to build a massive $1.5 billion wind farm in West Texas. The consortium behind the project expects to get $450 million in stimulus money.
Walt Hornaday, an American partner on the project, said it would create some American jobs. "Our estimation," he said, "is that we are going to have on the order of 300 construction jobs just within the fence of the project."
But that's in addition to 2,000 manufacturing jobs -- many of them in China.
Lauren Reynolds, a reporter at ABC's San Diego affiliate 10 News, paid a visit to the vacant office of A-power.
To read more about how wind energy companies in San Diego are forced to spend their federal stimulus dollars abroad, go to today's San Diego Tribune and the Watch Dog Institute's Web page.