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Winds of change: Port looks beyond recent green boom February 7, 2010

For two years, wind energy has brought a gale of a business to the Port of Longview. But change is blowing through the industry, and port officials say they are gearing for the end of boom times.

The port collected a combined $17.6 million in wind-energy handling fees in 2008 and 2009, and those fees were a major reason the port had record revenue each year. The off-loading of the giant wind towers, turbine blades and nacelles manufactured overseas has meant more work for area longshoremen, who recycle the money paid by shippers back into the community.

Federal officials are pushing for more domestic wind-energy manufacturing, which could translate into lower demand for imports through the port. The recession has stalled large-scale wind projects, and wind energy expansion is limited by the capacity of high-voltage transmission lines.

“The industry, as a whole, is experiencing some general flat-lining,” said Valerie Harris, Port of Longview marketing director.

Port officials forecast wind energy to be a steady commodity for about five to seven more years. Late in this decade, wind-energy equipment will likely come through the port intermittently instead of steadily, Harris said.

This year, business will slow down as a lagging effect of the recession, but it should pick up through the middle of the decade, Harris said.

In 2008, the port broke a nine-year-old record by hauling in $23.5 million in revenue. About 40 percent, or $9.4 million, was from wind-energy transport.

“It’s given us a lot of man hours and a lot of work, especially in the economic downturn,” said Dan Coffman, president of the Longview-based International Longshore and Warehouse Union local 21.

Port officials are predicting another record-breaking revenue year for 2009. Final numbers aren’t yet available, but the port’s wind-energy revenues fell to $8.2 million in 2009.

Going with the grain

So what’s the next big money-making cargo for the Port of Longview? The obvious answer is the $200 million grain terminal Portland-based EGT Development is building at the port. With a capacity of 8 million metric tons, the elevator is expected to make the Port of Longview a major West Coast grain exporter when it goes online next year.

The grain elevator is expected to create 50 full-time jobs, and 30 would go to longshoremen, Coffman said. The elevator likely will employ more people than wind energy imports because it will operate with more shifts, he said. Also, with demand rising in Asia, grain export isn’t likely to be a boom-and-bust business, port officials say.

“If wind energy does taper off, the (grain) facility will still be there,” said Ken O’Hollaren, Port of Longview executive director.

Revenue from log exports, once king at the port, is slowly coming back as the rest of the world emerges from the recession, O’Hollaren said.

The port also is exploring domestic shipping to other West Coast ports and expanding its barge traffic to inland states, he said. For example, the port could load logs on barges to travel along the coast or head inland along the Columbia River, O’Hollaren said.

Also, the port could start importing materials and parts such as steel paneling needed to build the wind towers and turbines if U.S. manufacturing starts to take off, Harris said.

“We haven’t waited until we saw a downturn or a flat-lining in wind,” she said.

Along the West Coast, the ports of Longview and Vancouver have emerged as the premier handlers of wind-energy cargo. In Vancouver, port officials say they haven’t pinpointed when wind-energy imports will sunset.

“It’s just too early to tell,” Port of Vancouver spokesman Nelson Holmberg said.

Wind blowing offshore?

The port’s wind energy business could reverse itself over the next few years.

Both Vancouver and Longview ports are looking to move into the export of wind energy equipment, especially with President Obama pushing for more green jobs. Over the past two years, the Port of Longview has loaded a handful of ships with wind-energy cargo manufactured stateside and bound for Asia and Europe.

“With the wind industry being a global industry, an increase in U.S. and worldwide manufacturing as well as installations will likely result in more activity for ports, back and forth, as markets continually adjust on a global basis,” said Christine Real de Azua, a spokeswoman for the American Wind Energy Association, a Washington, D.C.,-based trade group.

“For example, some components will eventually be exported from the U.S. to other countries as the U.S. builds up its capabilities and the president seeks to boost our exports,” she said.

Wind power capacity worldwide grew by 31 percent in 2009, according to the Global Wind Energy Council, and China accounted for about one-third of the growth. The United States accounted for about 10 percent.

About 2,000 megawatts of wind power capacity already is on line in Oregon and Washington. Over the next two decades, Western states can handle about 4,500 more megawatts of wind energy, which would power more than 1 million homes, said John Harrison, spokesman for the Portland-based Northwest Power and Conservation Council.

The electricity transmission grid can’t handle much more growth that, Harrison said. To help add capacity to the system, the Bonneville Power Administration, the largest power marketer in the Northwest, is planning to build a 70-mile-long transmission line from Castle Rock to Troutdale, Ore.

Wind energy depends on the wind blowing, which is why utilities need a reliable source, such as hyrdropower, as a backup, he said.

“When the wind isn’t blowing, the dams can be turned up. When the wind is blowing, the dams can be turned down,” Harrison said.

Demand for wind energy worldwide is likely to remain high for years, but it remains to be seen where clean-energy-hungry countries will buy the equipment.

Despite all the talk of adding domestic green power manufacturing, total employment in the industry was down in 2009. Without the federal stimulus package approved last February, wind energy would have lost 40,000 jobs, according to American Wind Energy.

Denmark and Japan remain the big players in the manufacturing of wind-energy components, which bodes well for the import business at the Port of Longview.

That’s good news to Coffman, president of the longshore union. Longview is an attractive port for wind-energy manufacturers because its has a new, $4.7 million mobile harbor crane and longshoremen experienced in handling wind cargo, he said. One Longview operator developed an innovative strategy to handle the turbines with a forklift more quickly, which boosts business, he said.

“It just shows the creativity of some of our people here,” Coffman said.

Erik Olson, The Daily News – http://www.tdn.com/news/local/article_96fa57b8-139c-11df-9924-001cc4c03286.html

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