Convergence of Auto Industry with Cleantech Sector for Green Jobs

In reference to this template article, as the American auto industry undergoes continued transformation, the green revolution offers an opportunity in the building of fuel efficient hybrid electric vehicles where former plants cannot be converted to clean energy manufacturing, namely solar plants of various sorts.

As the U.S. automobile industry undergoes a major transformation in many respects, it is converging with the emergence of the green revolution in the country. The Big 3 automakers, Ford, General Motors (GM), and Chrysler have underwent revolutionary overhauls in how they operate their business, and now after relieving excess inventory through a moderately green Cash for Clunkers program, they are focusing on meeting tightening fuel economy and emission standards in their pursuit of new lines of hybrid electric vehicles using innovative battery technology. However, the leftover pieces from significant downsizing and auto plant shutdowns are now being considered by clean energy, namely solar, manufacturing companies around the nation. This trend is analogous to the transformation of former microelectronics fabrication facilities to solar cell production centers internally or by other companies, as many chipmakers outsource manufacturing to Asia due to significantly lower labor costs and corporate tax rates, as the U.S. has the second-highest globally for major industrialized countries. 

 

Two alternative energy companies plan to purchase a former Ford auto plant in southeast Michigan, where state-wide unemployment of 15 percent surpasses all other states, and convert it into a renewable energy industrial center that would employ over 2,800 green job workers within five years. Xtreme Power of Kyle, Texas, and Clairvoyant Energy of Santa Barbara, California, presented their proposal of buying the 320-acre Wixom Assembly Plant to state lawmakers recently, which is pending on state tax incentives and federal loans approvals. 

 

If the deal is signed, the companies would renovate the former thriving Wixom plant that closed in 2007 after 50 years. Approximately half of the space would be dedicated to the companies' portfolio of products, while the remaining portion would be leased to suppliers and other renewable energy companies. Xtreme develops energy storage systems for utilities, wind farms, and large manufacturers, as these components are a critical link to the integration with the power grid, especially until a national “smart” grid is built. Their battery products can store energy during the day, when solar power output is high, as an example, and then release it for higher demand periods in the evenings.  

 

In comparison, Clairvoyant develops roof-top solar power generating stations. Furthermore, the convergence of the green revolution with the auto industry is evidenced in Clairvoyant’s construction of the world's largest roof-top solar plant at a GM plant in Spain. Collectively, Xtreme and Clairvoyant are evaluating building a university research facility at the former Ford facility as well, where workers could be trained. The Recovery Act set aside funds for green job training so the companies may be able to capitalize on those opportunities in this case. 

 

Xtreme and Clairvoyant are preparing for a September 14 deadline to apply for federal loans regarding renewable energy projects through the Department of Energy. However, before the companies submit their applications, they have requested Michigan to approve $100 million in refundable tax credits for advanced battery production and a $25 million tax break for solar-based manufacturing in addition to increasing the number of job-creation tax credits offered by the Michigan Economic Growth Authority. The impact of tax credits for attracting alternative energy companies cannot be underestimated, as states such as Arizona have finally begun to realize this fact, especially after losing opportunities to surrounding states such as New Mexico and California in years past.  

 

Other states such as Utah are jumping on the bandwagon of the green revolution to help revitalize their economy. Utah Gov. Gary Herbert stated in recent weeks that the state's future success is interconnected with the development of its energy resources. However, he appears less committed to renewable energy as the driving force compared to other states and has offered few details of how he plans to enable energy resource development. Gov. Herbert said he is interested in creating a balance of traditional oil, natural gas and coal resources with wind, solar and other renewable resources. The lack of competitive tax breaks for corporations are yet again critical for enticing alternative energy companies, while the state’s lax renewable energy portfolio standard of 20 percent by 2025 is non-binding and will hinder green investments. 

 

Interestingly enough, there is even more reason to support solar companies such as Stirling Energy Systems (SES), based in the Phoenix, AZ area, in purchasing former automobile or related parts manufacturing facilities. The SunCatcher concentrating solar power (CSP) dish engine technology from SES utilizes automotive supply chain manufacturing techniques for high-volume production through an assembly line process. Actually, they are already use facilities in Detroit, MI for engine component development.

 

This technology is being implemented by Tessera Solar and the Salt River Project (SRP) utility company, whom announced plans to collaborate on a 1.5-megawatt (MW) solar project, denoted as Maricopa Solar LLC, in Peoria, Arizona, located in the western Phoenix metropolitan area. Maricopa Solar will be the first commercial-scale solar facility built using the innovative SunCatcher CSP, solar-thermal enterprise manufactured by SES. Overall, the plan includes the construction of 60 SunCatcher dishes and should be completed prior to plants in California and Texas, which will be much larger in size and scope. In general, CSP efficiency levels are climbing and breaking new records on a regular basis across the industry, reaching over 41 percent for one particular recent design. What’s more, CSP is becoming the standard for large-scale solar farms, especially in sunny dessert regions, where solar exposure rates compensate for the higher cost of this solar power generation method.

 

The Maricopa Solar project will be located in proximity to the Agua Fria Generating Station, a power facility owned and operated by SRP in Peoria. In addition, the solar plant will be under construction beginning in September and a January 2010 completion date has been set. Moreover, it will employ 40 to 50 construction workers and will be operated by Tessera Solar under a 10-year agreement. More than 90 percent of the SES SunCatcher components will be manufactured in North America, generating thousands of new green jobs overall. As noted in a past report,  green job creation outpaced total U.S. job creation during the whole length of the 1998-2007 study period analyzed. 

 

The Arizona plant will be a test-bed as SRP prepares to meet its portfolio goal set by its publicly elected Board of Directors, which requests the utility to meet 15 percent of its retail energy needs with sustainable energy by 2025 in response to state regulations. In addition, the 1.5 MW plant will allow SRP to have an initial experience with this technology, its output and integration into the grid.

 

As the American auto industry undergoes continued transformation, the green revolution offers an opportunity in the building of fuel efficient hybrid electric vehicles where former plants cannot be converted to clean energy manufacturing, namely solar plants of various sorts.

 

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