Release Date: June 18, 2010

Wind farm towers take local turn: Manitowoc firm will build 90 steel structures for We Energies Columbia County project

Milwaukee Journal Sentinel

Tower Tech Systems of Manitowoc will build 90 steel towers for Wisconsin's largest wind farm, as We Energies adds a "buy-local" flavor to its renewable energy project near Madison.

The Manitowoc maker of wind turbine towers will build the 262-foot tall towers for turbine maker Vestas. The turbines will be erected next year in Columbia County at the $367 million Glacier Hills Wind Park. The move comes as European companies like Vestas and Ingeteam look to expand their domestic production of wind power components. Ingeteam last week broke ground on a $15 million wind power generator factory in Milwaukee's Menomonee Valley.

For its part, Vestas is ramping up production of turbines, blades and towers at factories in Colorado. But for this project, Vestas opted to work with Tower Tech Systems, a Manitowoc company that's part of the wind component firm Broadwind Energy Inc. Including factories in Texas and South Dakota, Tower Tech is the third largest producer of wind towers in North America. The value of the contract hasn't been disclosed, but Chief Operating Officer Paul Smith said it will mean job security for employees at the sprawling Tower Tech complex near Lake Michigan. As wind project development slowed because of the recession, Tower Tech laid off workers.

But this contract and other orders placed by Vestas will enable Tower Tech, now employing 160, to bring back about 60 to 80 workers from layoff in the coming months.

"We're running at almost close to capacity for the next year," Smith said. "Part of that is towers we're delivering for other Vestas projects, and then the remainder is for the We Energies project next year. From an employee retention perspective it's very important to us."

For We Energies, the utility moved to more aggressively pursue Wisconsin businesses involved with construction and manufacturing components for this wind farm, compared with the state's first big wind farm in Fond du Lac County, said Rick Kuester, executive vice president of Wisconsin Energy Corp., the Milwaukee utility's parent company. We Energies did not mandate that turbine suppliers buy towers locally, but the utility encouraged Vestas to consider Tower Tech in part to simplify the logistics of moving the giant wind power parts.

"We want the local economy to do well, and to the extent we can find ways to contribute to that, we want to be a company that really helps Wisconsin have a healthy economy," Kuester said.

Helping the economy grow can also help restore growth in power demand after the downturn saw factories shutter and energy use by We Energies customers revert last year to levels not seen since 1993. 'Made-in-USA' shift The "made-in-USA" bent to this project is a big shift from just a few years ago. We Energies' first big wind farm, Blue Sky Green Field project built in 2008, relied heavily on imported components. Vestas supplied the turbines for that project as well, but the towers were made mainly in China and Vietnam, and most of the other main components came from Europe.

Because of the Tower Tech contract and other moves, We Energies estimates that Wisconsin companies will see $120 million in business from this project -- more than twice as much as the Blue Sky Green Field project. The two Wisconsin projects illustrate a dramatic shift taking place in the wind-power supply chain. Five years ago, the wind industry imported 75% of the components for wind farms, but by 2008 half of the components came from within the United States.

In Wisconsin, state and regional economic development leaders see wind power manufacturing as a key growth area. A Wisconsin wind components group has been pushing to expand the local participation in the wind power components sector, appearing at the wind industry's big trade show in Dallas last month.

"In the New North, the wind industry continues to be one of our strongest industry clusters that we've been focusing attention on," said Josh Morby, spokesman for the economic development group representing northeastern Wisconsin.

Construction of the Glacier Hills wind farm, northeast of Madison, began in May with site clearing. Foundations will be dug and poured this year, and the towers and turbines will be erected next year. Wisconsin contractors on the job include The Boldt Co. of Appleton; Michels Corp. of Brownsville; and Edgerton Contractors of Oak Creek. The Tower Tech deal was finalized in recent weeks, and last week the utility added another Wisconsin supplier when it awarded a contract to supply the main power transformers for the Blue Sky Green Field substation to Waukesha Electric, Kuester said.

"Much like the rest of the economy, we've been buffeted about, but I will tell you that as we look out into 2011 and 2012 the market looks strong and the opportunities are there," said Martha Wyrsch, chief executive of Vestas North America, in an interview from Portland, Ore. Vestas employs 800 at its Colorado factories.

The company has also opened three wind power technology research-and-development centers around the country, one of which is in Madison, she said.