YOU DON’T HAVE TO BE an industrial giant to be a player in the American wind business. American Superconductor, a Massachusetts firm, markets and licenses state-of-the-art turbine designs to global manufacturers. In the Great Lakes region, about seventy firms are involved in manufacturing turbine components and subcomponents. One of them, just outside Cleveland, is a family-owned bolt-forging company called Cardinal Fastener. When Barack Obama made his pre-inaugural whistle-stop tour from Chicago to the nation’s capital in January 2009, he made a point of visiting the Cardinal Fastener forge, where he talked up wind energy’s importance in a spirited meeting with plant workers. In a video clip documenting the event, two muscle-bound workers firmly grip a yard-long piece of gunmetal-gray hardware. “This is a 2¼-inch heavy hex bolt,” one of them says as he peers at the camera through his protective eyewear. “Now it’s called the ‘Obama Bolt.’ ”1
General Electric supplies nearly half of America’s wind turbines, but most of the equipment in its machines comes from smaller manufacturers scattered across the country and around the globe. Though GE has no real competition among U.S. turbine producers, one much smaller company, Clipper Wind, has worked valiantly to establish itself in the market. Clipper’s road has been a rocky one, fraught with technology flaws and financial distress, but it has brought new jobs and new hope to hundreds of workers at its turbine assembly plant in Cedar Rapids, Iowa.
Small and sparsely populated, Iowa has captured a surprising number of new wind energy manufacturing jobs. Ranking thirtieth in the nation in population, the Hawkeye State has the fourth-largest workforce commitment to wind manufacturing, outflanked only by Texas, Illinois, and Colorado.2 When fully staffed, nine wind-dedicated factories scattered across cities and towns in southeastern Iowa will employ 2,300 workers.3 Some of these jobs are in foreign-owned workplaces like the blade factory that Siemens built in Fort Madison and the turbine assembly plant that Acciona, a Spanish company, now operates in West Branch. Others are in American-owned factories like the Trinity Structural Towers plant in Newton, Iowa, a major supplier of turbine towers to GE. Across a stretch of cornfields from the tower plant is a blade factory run by TPI Composites, a Rhode Island–based firm. These two operations have filled at least part of the huge employment gap created when Maytag shut down its headquarters and appliance assembly plant in Newton in 2007. And then there are the many Iowa firms—more than 200 of them4—that are part of a supply chain providing the 8,000 components and subcomponents that make up the modern-day wind turbine.5
Clipper began assembling wind turbines in Cedar Rapids in 2006, and it has since brought approximately 350 jobs to a city that has seen one Rust Belt factory after another close down or move out of state. The company is a relatively small player, supplying 6 percent of the U.S. market in 2009 and only 1.4 percent in 2010, but it is emblematic of the hundreds of firms that are now contributing to the U.S. wind industry.
When I traveled to Cedar Rapids in February 2010, Iowa’s premier industrial city still looked badly beaten by the flood that had engulfed it two years earlier. The Cedar River’s roiling waters had driven more than 8,000 people from their homes and had forced hundreds of city businesses to close, some forever. On my visit, I found entire streets of modest clapboard homes nailed shut, empty of life. If it weren’t for the snow on the unshoveled sidewalks and pitched rooftops, this could have been post-Katrina New Orleans. A few doors down from the boarded-up Paramount Theatre, I read a spray-painted message on an abandoned store window: “Bent, not broken.”
Sited on the southern edge of the city, Clipper narrowly escaped the river’s wrath. Veteran machinist Mark Meader told me the factory survived because it sits “on the highlands,” actually only a few feet above the waters that flooded out Clipper’s nearest downhill neighbor, Casey’s General Store. Just as Clipper managed to dodge the flood, Mark and his coworkers Mick Boots and Dave Wheatley have been spared the worst impacts of heavy industry’s flight from Cedar Rapids. All three men, in their early sixties, were hired by Clipper within the past few years. They consider themselves lucky to have found jobs in their fields.
Wind energy may be a rapidly evolving twenty-first-century technology, but it has strong roots in heavy industry, in the kinds of trades that Mark, Mick, and Dave have plied for decades. All three worked many years at Goss Graphic Systems, manufacturing newspaper printing presses until that factory closed in 1999. Mark worked in the machine shop, Mick in assembly, and Dave in engineering. “As a group, we were pretty much used to dealing with heavier, bigger, bulky items,” Dave recalls. “It’s nice to see this kind of industry come back into the area.”
Bob Loyd is the person responsible for bringing his former coworkers at Goss over to Clipper. He ran the assembly operations at Goss, and he’s now the plant manager at Clipper. “When we started off this plant, I literally picked up the phonebook and started calling people I knew,” Bob recalls. “I knew good mechanics and electricians, guys who know gears. If you think about a printing press, it’s a big gearbox with hundreds of gears.” He realized that wind turbine machinery isn’t so different.6
As he set about staffing the Clipper factory, Bob knew what he was looking for. He wanted a crew of seasoned industrial hands who could train a younger cohort coming from their first jobs or from courses in electronics, automobile mechanics, and engineering at Kirkwood Community College, just a mile or two up the road. Then, after five to ten years, the older guys could retire, having secured a next-generation workforce for this struggling Rust Belt city.
Born and raised in Wisconsin, Bob comes from a long line of mechanical and civil engineers. His great-grandfather had a bridge-building business; both grandfathers were engineers; and his father was the lead engineer at a company that built large diesel engines for U.S. Navy ships. College studies brought Bob to Iowa, where he started out at Iowa State and then transferred to the University of Iowa, earning an MBA and two engineering degrees. Despite his university credentials, he describes himself proudly as “a wrench turner.”
“We all have dirt under our fingernails,” Bob tells me as he leans back from the piles of paper on his desk. His broad hands rest firmly on the molded plastic arms of his chair, and he smiles. “I work on tractors, motorcycles, cars.” His spartan office is just footsteps away from the vast factory floor, where workers assemble gearboxes, burnish cast-iron turbine hubs, and mount all manner of electronic equipment into the nacelles of Clipper’s 2.5-megawatt Liberty turbine. The company is now developing larger machines for onshore and offshore wind farms, but the Liberty is Clipper’s flagship.
The Liberty’s Cedar Rapids birthplace, at 4601 Bowling Street SW, is a mammoth steel-frame shed whose history tracks the course of Iowa’s rocky romance with heavy industry. It also holds important memories for Bob Loyd. The building opened in the mid-1960s, when Link-Belt Construction Equipment Company began manufacturing cranes and excavators at the site. Bob joined the company fresh out of college in 1973. By the mid-1980s, Link-Belt would be gone, bought out and moved south by a Japanese conglomerate, Sumitomo Heavy Industries. Bob later found himself back in the space as manager of the Goss printing press assembly plant. That company, too, did not last long in Cedar Rapids. Succumbing to fierce price wars with foreign competitors, Goss laid off hundreds of workers and eventually filed for bankruptcy.
Next in was Maytag, which used the building as a warehouse for refrigerators. By 2006, Whirlpool had acquired the fading Maytag brand and soon announced that it would be shutting down the company’s headquarters and most of its assembly operations in Iowa. About 1,800 local Maytag employees, from office workers to factory laborers, lost their jobs.7 Although some limited Whirlpool manufacturing remained in Iowa, there was no longer a need for warehousing at the Bowling Street facility.
When Bob was hired by Clipper, he welcomed the chance to breathe some new life into the battle-scarred factory space that he knew so well, and he was even more excited to help a few hundred people find jobs once again in heavy industry in Iowa. With all the local factory closures, he knew plenty of people who had been forced out of the field. Dave Wheatley was one of them. A skilled mechanical engineer, Dave drove a FedEx truck, worked as a taxi driver, and built windows after the Goss debacle. Mark Meader found a job as a carpenter. Others migrated to food processing plants around town. Many of these dedicated industrial hands, Bob knew, would jump at the chance to return to building some real machines.
For Bob, Clipper’s allure went further. He had worked for Rockwell and Raytheon, so he knew that “heavy industry” often involves a heavy dose of defense contracting. “I wouldn’t have been excited if we were making armaments for the military,” he acknowledges. But when he talks about wind turbines and renewable energy, his voice becomes animated and his face brightens. “This is a product the country needs . . . and it’s a great thing for the state. It helps the farmers, and it helps kids get good jobs.”
Now nearing sixty, Bob has poured heart and soul into bringing youth and a hopeful future to the Clipper factory on Bowling Street. With obvious pride, he introduces me to four of the company’s younger crew members. After seating us around a white laminate lunch table in the staff lounge, just off the factory supply room, he goes back out onto the factory floor, leaving us to talk. It’s 3:30 in the afternoon and the room echoes with the pounding of the punch clock a few feet away. First-shift workers, mostly in their twenties and thirties, are streaming out of the building, and the second shift is coming in.
Matt Lalley is one of Bob’s next-generation hires. Boyish-looking and a little shy, he tells me about his work as second-in-command in the electrical department, where he troubleshoots issues that come up in the assembly of generators and turbine control systems. His work as a car mechanic helped prepare him for the job, and what he didn’t learn in the car repair shop, he has picked up on the factory floor.
Joel Peyton, twenty-seven, talks excitedly about his work as lead technician in the Remote Monitoring and Diagnostic Center, which tracks the performance of hundreds of Clipper turbines at wind farms stretching across the continent. He came to Clipper fresh out of college, where he studied management after training to be an electrician. Every day, he commutes forty miles each way from a farm where he and his father grow corn and beans. “It’s our hobby,” he says of the farming, adding that his father’s real job is in Clipper’s gearbox assembly division. A concrete worker for many years, he followed his son to the company just a few months after Joel came on board in October 2006.
Matt chimes in that his dad works alongside Joel’s dad in gearbox assembly. Then Mary Tiedeman tells me that she has an uncle and a cousin who work in the plant. Mary, also very young, is one of the few women I have seen. Trained in child care and family services, she works as a receptionist.
“For the record, my dad doesn’t work here!” the fourth in our gathering pipes up. Everyone around the table breaks into laughter. Tyler Glass, a twenty-one-year-old fix-it guy and 3-D computer designer, has just finished his training in mechanical engineering at Kirkwood Community College. Cherubic and animated, Tyler verges on euphoria when he talks about his job. “I love it—I love coming to work every day. It might sound cheesy, but I wouldn’t say I’m here just to get a paycheck,” he says. “I truly do believe in what we are doing.”
Bob leads me through the gearbox assembly bay to a production zone where workers are busy installing electronic, mechanical, and hydraulic controls into Liberty nacelles. His people skills are obvious. Everyone gets a jovial, first-name greeting, followed by a question that shows Bob’s awareness of exactly what that person is contributing to the Clipper effort.
The Clipper day begins at 7 a.m. with a shiftwide calisthenics class. In addition to staying fit, Bob wants people to feel part of the team. Some days he leads the exercises, but often he recruits others. “We always pick on somebody,” he explains in a gentle tone that makes it clear this is an act of inclusion, not punishment.
Reflecting more broadly on workplace morale, Bob describes a quick-turnaround electronic suggestion box that invites workers to air their concerns. He calls it “VOICE,” which is much easier to swallow than “Valued Operational Improvement for Clipper Excellence.” Each month, the worker with the best idea gets a gift certificate.
Operational and design improvements are the name of the game for a small turbine company that is fighting its way into a market dominated by global giants like GE and Vestas. Technology glitches can be devastatingly costly, as the Clipper management team has learned in its bumpy start-up years. Joel Peyton is on the front lines in spotting problems as they pop up on the big-screen computer monitors that line the walls of the Remote Diagnostic and Monitoring Center, a crowded cluster of small rooms just around the corner from Clipper’s staff lounge. We enter the center through a door prominently marked “Tornado Safe.” In the stormy Midwest, I imagine this is no joke.
For every Clipper turbine across the continent, dozens of parameters are transmitted on a real-time basis to the center’s computer data bank. Joel leans down, types in a few codes, and opens a window that displays data about the Fowler Ridge Wind Farm in Benton County, Indiana. Ambient and equipment temperature, wind and rotor speed, generator revolutions per minute (RPM), power output, and much more are monitored in real time for each of the forty Clipper turbines operating at this site.
A lot can go wrong when accelerating the rotational speed of a Liberty turbine from the top hub speed, 15.5 RPM, to the maximum generator speed of 1,133 RPM. Lubricating oil needs to be warm enough to flow to the spinning gears—a challenge in the super-cold weather that strikes many of America’s premier wind sites. Pre-heating the oil is essential. “We don’t want to push very thick oil through small holes,” Joel explains. Without proper lubrication, bearings and gearboxes can overheat, causing a red icon to flash on the computer monitor and triggering an immediate shutdown.
Worker safety is another factor carefully watched by Clipper’s thirteen-member remote monitoring and diagnostic team. Joel switches to a screen showing a satellite map of the continental United States and beyond. Two circles surround every Clipper-equipped wind farm, a red one at a thirty-mile radius and a yellow one at fifty miles. Looking at the Bahamas, I point to brightly colored splotches on the screen, which Joel explains are lightning storms. “In the summertime, we can get pretty busy with lightning alerts,” he says. “When technicians are busy up-tower, we want to give them a pre-warning so nobody gets hurt.”
The Remote Monitoring and Diagnostic Center can make system-wide changes, where needed, to improve turbine operations. “We can adjust parameters here on 400 turbines and make sure it’s done correctly,” Joel explains. “Less human error, I guess you could say.”
Even with this fine-tuning in the field, quality control poses a particular challenge for Clipper, as it does for several other turbine companies that purchase most of the components and subcomponents in their machines from outside vendors rather than manufacturing them in-house. Unlike Vestas, which produces much of its own hardware, almost everything that goes into a Clipper turbine is brought in from outside. Its generators come from Mexico. Castings for gears and hubs are supplied by vendors in the United States, Germany, Brazil, and Spain. Main shafts connecting turbine rotors to generators are forged in the United States and Slovenia. Blades are made by the same Brazilian firm that produces blades for GE’s turbines. And towers come from as close as Chattanooga, Tennessee, and as far away as China. In all, Clipper relies on 120 outside suppliers for its turbine components and subcomponents.8
With parts coming from so many sources, maintaining uniformly high production standards demands constant vigilance. The steel used in gears, shafts, and bearings must be extremely durable to withstand the rigors of operating a machine that is in nearly perpetual motion, out in the elements, from one season to the next, year after year. Blades must be strong enough structurally and yet sufficiently flexible to accommodate widely varying wind conditions, and their surfaces have to withstand every kind of weather, from sub-zero cold to searing heat. And all moving parts must conform to very precise dimensional tolerances, ensuring their own internal integrity as well as their compatibility with components coming from other vendors.
To manage the global supply chain, Clipper has a full crew of quality-control technicians who inspect vendor factories across North and South America, Europe, and Asia. Quality-control experts are also on-site in Cedar Rapids, monitoring equipment as it arrives at the Bowling Street plant and testing key components on carefully calibrated machines. On our walk through the plant, Bob Loyd shows me a sound-insulated chamber, at the end of one long assembly bay, where every gearbox is run at up to 130 percent of maximum load under a variety of simulated wind conditions over a four-hour period. He likens this regimen to Detroit’s factory testing of automobile drivetrains: both verify good mechanical performance but do not really mimic the stresses placed on equipment over many years of real-world operations.
For all its vigilance, Clipper encountered some serious defects in its Liberty turbine, starting in 2007. That year, the company reported a “supplier quality deficiency” that compromised the Liberty’s drivetrain and gearboxes. Later the company divulged that more than a third of the turbines produced in 2006 and 2007 required drivetrain repairs. Defective blades added to Clipper’s woes, requiring the blades on about 260 rotors to be reinforced. Most of these rotors had already been delivered to widely scattered wind farms, making repairs much more difficult and expensive. The combined price tag for repairs topped $107 million by the end of 2007.9
Cracked blades and other defects continued to plague the company in the years that followed. Repair costs escalated to $222 million in 2008, and it took until early 2010 to repair all the damaged blades.10
Clipper did what it could to minimize the costs of repairing its turbines in the field. Initially, to take down or put up a blade, Clipper repair crews would use a huge crane that had to be hauled to each site on fifteen to eighteen semitrailers. This cost the company a profit-killing $200,000 per job, or twice the price of the blade itself. But then the company’s engineers came up with a new way to swap blades, using a technique that required only a few specialized tools and a cherry picker like the ones that phone company line crews use for repairs. The cost: $15,000 plus a few hours’ labor. Similar savings were achieved by using the Clipper’s built-in hoist, rather than a rented crane, to switch out faulty gearbox components.
Despite its attempts to streamline repairs, the burden of so much unscheduled maintenance took a severe toll on Clipper’s balance sheet. Then the financial crisis hit, causing wind farm developers to slow their implementation of existing projects and freeze the development of many future ones. By September 2009, Clipper’s cash reserves had dropped to a precarious $40 million. The company was in need of a bailout, and United Technologies Corporation came to the rescue.
Under the deal with UTC, Clipper initially surrendered 49.5 percent ownership to the Connecticut engineering giant in exchange for a pledge of a quarter-of-a-billion dollars. Ultimately, as Clipper’s financial condition worsened, UTC ended up buying the company’s remaining shares for $112 million in the fall of 2010.11
In taking on this relatively small, ailing enterprise, UTC’s leadership saw a bigger strategic opportunity. Ari Bousbib, executive vice president and president of commercial companies at UTC, looked enthusiastically at the global market trends for the $50 billion wind industry. He commented to the press: “Other than maybe elevators in China, I don’t know many industries that have grown at 25 percent a year.”12
While acknowledging that his company urgently needed an outside infusion of capital, Clipper’s chief commercial officer Bob Gates sees the UTC buy-in as much more than a financial bailout. He talks about the knowledge transfer the merger brings, given UTC’s long history of manufacturing precision-engineered products ranging from Otis elevators and Sikorsky helicopters to Pratt & Whitney jet engines and industrial turbines. “You know, the elevators and escalators that Otis makes are all electronically controlled, and the elevator always stops at the right floor,” he comments wryly. Gates is confident that Clipper will benefit from a higher level of quality control on the equipment it installs in its wind turbines.13
Just as Clipper is a story of Rust Belt renewal and pioneering innovation, it is a cautionary tale with some important lessons to companies that are looking to come in on the ground floor of an exciting but demanding new industry. Perhaps most obvious is the need for extreme vigilance before dispatching turbine technology of today’s mammoth scale to far-flung wind farms. When blades get to be 150 feet long and are bolted onto hubs that are more than 250 feet in the air, companies better make sure they’re sending out equipment that their customers can count on. The same is true for high-stress components like gearboxes and generators. Neither Clipper’s quality-control teams nor the company’s in-house simulators were successful at intercepting serious problems that later rang up such huge replacement costs in the field.
Another lesson relates to scale—not of the turbines themselves, but of the companies manufacturing them. Competing in the global marketplace for wind technology demands a level of financial commitment and an ability to absorb setbacks that are far beyond the means of relatively small, modestly capitalized companies like Clipper. Remember the Zilkhas’ decision to bring in Goldman Sachs when Meridian Way and other wind farm developments needed a big-time infusion of capital; as savvy energy entrepreneurs, they knew when it was time to reach beyond their own resources. Clipper seemed to wait until disaster was at the door before it turned to UTC for a bailout.
While a company of Clipper’s size simply may not have been equal to the challenges of fielding today’s turbine technology prior to the UTC buyout, there is a place for smaller companies in the wind energy supply chain. With thousands of components and subcomponents going into the typical commercial turbine, the opportunities abound for specialized manufacturers to enter the industry. From manufacturers of bolts and flanges to the makers of hydraulic pumps and electric motors, companies of many shapes and sizes have already joined the American wind industry. These businesses stand to flourish as turbine companies at home and abroad—hopefully including a revitalized Clipper—expand their production to meet the growing demand for wind power in the coming years.
One of the conditions that will help the U.S. wind industry build and maintain momentum is a stable federal policy climate that puts renewable energy on an equal footing with traditional fossil fuel and nuclear technologies. Unfortunately, federal policies have been erratic and unreliable, inviting a degree of caution among energy investors, technology manufacturers, and wind developers that has impeded their full commitment to the enterprise.
Congress first approved a production tax credit for wind energy as part of the Energy Policy Act of 1992, with Senator Chuck Grassley of Iowa, fittingly, as its prime sponsor. Providing an income tax credit of 1.5 cents per kilowatt hour of electricity produced by wind, this law ushered in a wholly new approach to federal intervention in support of renewable energy.14 Unlike the investment tax credits that gave commercial wind its start in the 1980s, the production tax credit—or “PTC” as it’s called in the trade—rewards the actual generation of power rather than the mere building of new power-generating capacity. It gives wind farm owners and operators an incentive to operate their facilities as efficiently and productively as possible, minimizing downtime for repairs and maximizing the power produced by every operating turbine.
Though a valuable stimulant in concept, the PTC’s actual impact has been compromised by the ebb and flow of legislative support over the years. Congress first let the PTC expire in June 1999, when its initial authorization under the 1992 energy law ran out. It was reinstated six months later, but for only two years. Then, at the end of 2001, it lapsed again for a number of months, and once more at the end of 2003 when a comprehensive energy bill authorizing its extension failed to pass Congress. When the PTC resumed in late 2004, its approved duration was little more than a year. And so the pattern continued up until the American Recovery and Reinvestment Act of 2009 extended the tax credit for a somewhat less truncated three-year period, through the end of 2012.
By the time this Obama-era legislation became law, inflation indexing had raised the PTC for wind-generated power to 2.1 cents per kilowatt hour.15 What’s more, wind developers could choose between claiming the per-kilowatt-hour credit and taking a straight-up 30 percent investment tax credit on qualifying equipment and expenditures. As a third option, they could convert the investment tax credit to an outright grant amounting to 30 percent of the value of their installations.16 While some congressional lawmakers have attacked the degree to which these stimulus dollars have benefited foreign wind developers and manufacturers,17 American wind industry leaders have credited the stimulus package with preventing a U.S. jobs meltdown. According to the American Wind Energy Association, the wind industry lost about 10,000 jobs when new turbine orders lagged and new wind farm construction slowed in 2010 to about half the pace of the previous year. This brought the total wind industry workforce down from a pre-recession peak of 85,000.18 But with wind development regaining momentum in 2011, wind industry leaders are hopeful that jobs will regain and eventually outstrip their prior numbers.
Even with the infusion of stimulus funds, wind farm developers and equipment manufacturers remain wary of the future. Clipper’s Bob Gates points to his own experience negotiating with vendors. “When you go to a foundry in Ohio and you say, ‘Build a new plant to make more castings for wind turbine gearboxes,’ the casting company says, ‘What are you talking about? The PTC is going to expire in a year or two! I need ten or fifteen years to recover the cost of a plant.’ ”
“The PTC was meant to level the playing field economically, which it does,” Gates continues. “What it doesn’t do is level the playing field in the time dimension.” He points to the uninterrupted subsidies enjoyed over decades by the oil, gas, and coal industries and wonders aloud why wind—so much more benign—has been supported so much more sporadically. As one sign of our nation’s misaligned priorities, he laments our failure to internalize the huge environmental costs of coal: “You burn it—it’s gone. You have the emissions, you have the CO2, the energy source is gone, and for that, you get an incentive.” I find myself mentally adding to the list: the blackened lungs of miners, the ravaged mountainscapes and polluted streams of Appalachia, the endless procession of railroad cars carrying coal from the surfacemined moonscape of eastern Wyoming to power plants across the country.
As for nuclear, Gates points to the indemnity that Congress granted to power plant operators back at the dawn of the civilian nuclear industry in 1957. Under the continuously reauthorized Price Anderson Act, even the most catastrophic meltdown would expose the plant operator to less than half a billion dollars in liability.19 This level of federal protection for a civilian industry is without parallel in the United States, and its significance becomes very real when one contemplates the tens of billions of dollars of damage to property and people’s lives caused by the recent catastrophe at Japan’s Fukushima Daiichi nuclear plant.
“If a private company had to buy private insurance on a nuclear power plant, you wouldn’t have any nuclear power plants,” Gates flatly asserts. To that vast subsidy, we must add the billions of dollars the federal government has invested in trying to come up with a safe, long-term method for disposing of nuclear waste. Although no solution is in sight, civilian nuclear plants in America—104 in all—add to the nuclear waste burden every day. “How much does nuclear really cost?” He poses the question in exasperation, clearly not expecting an answer.
Building a U.S. wind manufacturing base extends far beyond the dozen or so companies that actually assemble turbines. The Timken Company, for example, is a successful industrial innovator that has long served the automotive and aeronautics industries. Today it is making a strategic bet on wind. The company’s politically conservative leadership defies any stereotypes about the wind industry being led by progressively minded twenty-first-century entrepreneurs who are eager to help America move away from carbon-based energy technology and are gung-ho about the battle against global warming.
Headquartered in Canton, Ohio, Timken is a world leader in the manufacture of precision bearings, ensuring the smooth operation of everything from helicopter rotors and jet engines to car transmissions and off-road construction equipment.20 With factories operating in twenty-seven countries, its 2010 sales totaled $4.1 billion.
Lorrie Crum, manager of Timken’s global media relations and strategic communications, is passionate about the company’s role in improving wind turbine performance. “Wind energy has been identified as the company’s most promising market,” she says, pointing to the $200 million that Timken has already sunk into pursuing its potential in this field. The fit is perfect, she says, for a company that prides itself on building for endurance—something of a mismatch with the automotive sector, where Timken’s products substantially outlast the machinery that hosts them. “We were able to make the million-mile axle, but you never capture their full value,” she says. All of those million-mile axles end up in the landfill, junked along with the rusting carcasses of cars that seldom travel more than a few hundred thousand miles.
Wind turbines, by contrast, need to operate day-in, day-out, season-to-season, year after year, over an expected lifespan of two decades or more. “This is extreme engineering,” Crum explains.21 Timken specializes in making bearings for the wind industry—meticulously crafted clusters of hardened steel rollers that hold key turbine components in place while allowing them to rotate with minimum friction. Ever since the company’s founder, Henry Timken, began exploring ways to make sturdier wheel assemblies for horse-drawn carriages in the late nineteenth century, the study of friction, or “tribology,” has been a driving force behind Timken’s technology development.
One of the “mission-critical” bearings that Timken provides to wind manufacturers is a tapered bearing that cradles the main shaft of the turbine, a multi-ton steel rod that carries the slow-spinning motion of the rotor—usually in the range of 12 to 20 RPM—to a gearbox that speeds up to match the demands of the turbine’s electrical generator. This bearing has to hold the main shaft firmly in place through all kinds of weather, allowing it to absorb the relentless jostling and wildly varying velocities of the winds in locations that are specially chosen because of their high prevailing wind speeds.
The damaged main shaft bearing from a large commercial wind turbine arrives just as we are touring the factory floor at the Timken Technology Center. Timken didn’t make the original bearing. Rather, the Technology Center’s engineers are being called upon to diagnose why it failed and to replace it with a more durable, custom-designed Timken bearing.
I watch as a diesel-powered mobile crane gingerly carries the main shaft assembly in through an open bay. Suspended by two triangulated wires from the crane’s extended arm is a shiny silver-colored shaft, about ten feet long. At one end is the steel casing, about three feet in diameter, which contains the ailing main shaft bearing. Jim Charmley, who heads up the Technology Center’s staff of 400 technicians, is on hand with me to witness this arrival. “We did not stage this for you!” he insists.
The main shaft bearing is designed to last the full twenty-year predicted lifetime of a wind turbine, but Charmley tells me that this one made it through only about two years. When I ask if many other main shaft bearings have failed on this particular turbine model, the MIT-trained mechanical engineer is circumspect. “I can only say that if [the manufacturer] had worked with us from the beginning, you might not see this here today.” With that, he introduces me to Gary, a colleague whom he describes as one of the world’s experts on nanocrystalline deposits—specialized metals like tungsten that can be applied to bearing surfaces to minimize friction and enhance durability. Gary, he says, will be incorporating nanotechnology into the bearing’s redesign.
Charmley points to his own staff’s dramatically shifted focus as a clear sign of Timken’s commitment to wind. In 2005, there might have been three technicians working on wind applications at the Timken Technology Center. Five years later, he estimates that eighty to a hundred specialists, including many of the fifty PhDs working at the site, have been redeployed to develop new Timken products and services for the wind industry. He shouts out these impressive numbers as we walk through a cavernous room filled with forty high-speed electric motors that are testing out newly designed bearings. Salt and dirt are sprayed onto some bearings to test the durability of the rubber seals surrounding them; other bearings are jostled and shaken to test their ability to withstand tough conditions in the field. All these simulations are run on an accelerated schedule so that Timken can keep a leg up on the competition. Established European competitors like SKF and FAG are busily developing similar products, and Asian companies are entering the game as well.
In addition to securing a substantial share of the U.S. wind market, Timken has its eye on a growing customer base overseas. Just a few yards from the defective main shaft bearing, laid out on a platform, is a huge metal ring, larger in diameter than the men standing by it are tall. Tightly spaced cylindrical steel rollers are sandwiched between its inner and outer rims, like tapered teeth in the maw of a large beast. In the coming days, this supersized bearing is to be loaded into the belly of a 747 headed for Beijing. From there, it will make its way by truck to a wind installation in Hunan province, where it will be tested as a prototype on a turbine manufactured by XEMC Windpower. This Chinese company is competing for a share of the market for “direct-drive” turbines—machines that generate electricity directly from the rotor, rather than relying on a main-shaft-and-gearbox configuration to feed a high-speed generator. Large, built-to-last bearings of this sort are at the upper end of Timken’s price scale, easily exceeding $100,000 and sometimes reaching $200,000 for a bearing equipped with computerized sensors that provide automatic, temperature-controlled lubrication of all moving parts.
The prototype bearing that we are admiring was produced at a Timken plant in South Carolina, but Jim Charmley and his colleagues have no intention of flying or shipping multiple bearings of this size halfway around the world. If the prototype works to XEMC’s satisfaction, production will shift to one of the half-dozen factories that Timken operates in the People’s Republic. Already the company’s Chinese manufacturing plants supply bearings, lubrication systems, and other related products and services to a number of Chinese heavy industries, and now it is looking to make wind a major part of its China business. Aside from the Chinese market’s unparalleled growth potential, the starkly efficient way China goes about building its in dustrial and transportation infrastructure makes it an appealing home for Timken manufacturing.
Timken’s international marketing team is more than willing to do business in a nation run by central planners, where the state plays a dominant role in governing and, in some cases, owning the companies involved in turbine manufacturing and wind farm development. But here in America, Timken’s leaders take a very different attitude toward government intervention in the industrial sector. Ward J. “Tim” Timken Jr., board chair since 2005, is a case in point.
Speaking at Ohio’s Ashland University in October 2009, Tim Timken leveled a broadside attack on the Obama administration’s economic recovery plan as a threat to American free enterprise. “Not since the Great Depression has government interfered so dramatically and so decisively in the economic life of our nation,” he declared, warning that the administration’s emergency stimulus expenditures gravely undermined any remaining public confidence in the private sector. “Nothing could be worse for our economy and our nation,” he asserted. He has been equally vehement in his assault on legislative proposals that would cap U.S. carbon emissions and require power plants and other major industries to pay for any carbon dioxide (CO2) emissions above their allotted amounts. He told the Ashland University gathering that this sort of “cap-and-trade” regime would “drive up the price of energy, deter American job creation, and send our jobs overseas.”22
Timken’s leaders have reason to be worried about the financial implications of any regime that attaches a price to carbon emissions. The company’s bearings are manufactured from recycled steel, in electric arc furnaces that process the steel-content equivalent of 100,000 cars per month. Timken’s Ohio facilities alone consume up to $50 million a year in electricity, mostly generated by coal.23 Communications manager Lorrie Crum contends that “we couldn’t possibly get enough sun or wind here to power our operations without relying heavily on conventional sources.”24
Crum may be right that, today, her company is more or less stuck depending on coal to fuel its steel plants and other factories. Yet she discounts too readily the longer-term potential for electricity generated by wind and other renewable resources. While Timken’s home state of Ohio has installed only a few megawatts of wind capacity to date, plans for building 1,000 megawatts of offshore wind on Lake Erie by 2020 have been announced.25 To the east, Pennsylvania has 748 megawatts of wind up and running, and New York developers have installed nearly 1,300 megawatts at their wind farms. To the west, wind power in Indiana has already topped 1,000 megawatts, Illinois has more than 1,500 megawatts of installed wind, and major offshore wind projects are now on the drawing boards for Lake Michigan. Reaching farther into the Great Plains, improved high-voltage transmission could open up truly vast resources in the heartland’s wind belt, extending from North Dakota and Minnesota down through Iowa and Nebraska to Kansas, Oklahoma, and Texas. With the right policy priorities and market incentives, Timken and other Rust Belt companies could end up substantially curbing, if not eliminating, their reliance on conventional fuels for most of their power needs.
Wherever they lie on the political spectrum, and whatever their attitudes about climate change and the role of government in shifting us away from carbon-based fuels, U.S. manufacturers are finally embracing the new opportunities that wind energy offers to their own business interests and the American economy. The growing pains of smaller companies like Clipper should warn us that we are still in the early stages of developing an entirely new technology base for our nation’s energy future. As in any pioneering technology field, the design challenges and operational surprises may stymie us at times, just as the financial setbacks may be harrowing. For decades, the federal government has generously nurtured our fossil fuel and nuclear industries. It behooves us to do the same for wind and other renewable energy technologies that can help create a less precarious platform for future development. With a serious commitment to cleaner energy choices, we can promote a vibrant, sustainable U.S. economy without perpetuating our reliance on foreign energy sources, without exposing ourselves to nuclear energy’s hazards, and without mortgaging the global climate.
The challenges facing U.S. wind technology companies are complicated by the fact that they are not alone in looking for ways to consolidate their positioning in the clean energy marketplace. High-caliber equipment coming out of Denmark, Germany, and Spain has long competed for U.S. sales, but with European manufacturers shifting much of their production to America, the net gains to U.S. workers and the U.S. economy are substantial. Much harder to gauge is the role that Chinese wind technology will play in the years ahead. As in so many other sectors, China is a hugely ambitious, rapidly growing force in the global wind trade, benefiting from cheap labor costs and brashly protectionist policies at home as it begins to market its turbines abroad. Although Chinese companies are only making their first forays onto U.S. soil, American wind manufacturers have reason to be nervous.