SAN FRANCISCO (Reuters) – Consumer products companies and retailers are looking at investing in new wind power developments in the United States, potentially filling in gaps in financing left by the credit crisis and setting a new model for renewable energy projects, Nordex USA Inc's chief executive said on Wednesday.
"Their pockets will be deep enough, yes," Ralf Sigrist, CEO of the U.S. unit of German wind turbine maker Nordex (NDXGk.DE: Quote, Profile, Research, Stock Buzz) said at the Reuters Global Climate and Alternative Energy Summit in New York. "How long it will take to get them into that type of investment we have to see."
Some of the businesses that are making forays into the renewable energy market include food companies and retailers who are looking to give their operations a green halo, Sigrist said, adding that many are also looking to take advantage of tax credits for renewable projects.
"Some of them have started with some reference projects where they look into building small, community type wind farms in the neighborhood of their stores or the neighborhood of their towns in order to use the power themselves and to give themselves a green image," Sigrist said.
From a purely financial perspective, such businesses are also looking to fill a gap in the downtrodden tax equity market, Sigrist said. The collapse of Lehman Bros a year ago and the ensuing financial crisis dried up demand for investments under which banks and others would fund renewable energy projects in exchange for tax credits.
Sigrist also said wind-generated power could reach 20 percent of U.S. electricity generation by 2020.
Nordex USA is building a $100 million manufacturing facility in Arkansas to prepare for a market surge in 2010 or 2011. The plant will start operations next year and ramp up to full capacity of 300 wind turbines, or 750 megawatts, in 2014.
Uncertainty about federal clean energy policy, however, is holding utilities back from signing onto new projects, Sigrist said. He added that utilities are waiting for the outcome of the energy bill in Washington and how Congress will handle a renewable energy standard.
Nordex is expecting to boost its U.S. sales to 20 percent of its total revenue by 2013 or 2014, up from about 13 percent this year, Sigrist said.
"This year is a slowdown," Sigrist said, noting that Nordex AG's growth rate fell to between 10 and 15 percent this year, down from a previous 50 percent growth rate.