Region's business leaders seek wind energy opportunity
Chris Coking, assistant general manager at his family-owned machine shop in Apollo, Armstrong County, is constantly exploring business opportunities.
"We do fabricating and machining. We're basically a job shop, with much of our business with the mills," Coking said of H.W. Nicholson Welding & Manufacturing Inc., founded by his grandfather in 1969. "We're trying to expand."
Coking on Wednesday joined more than 200 other businessmen and businesswomen from as far away as Virginia and Toledo, Ohio, hoping to determine if their machine shops, foundries, bearings manufacturers and other businesses can count on the wind as a new revenue source.
A standing-room-only audience attended "Wind Power and Supply Chain Prosperity," a workshop presented by the Great Lakes Wind Network with the state Department of Community and Economic Development and the Claude Worthington Benedum Foundation covering all expenses. The workshop was held at Robert Morris University's Sewall Center in Moon.
"This program is one of a series we're doing, in conjunction with the American Wind Energy Association, to help you see if diversification into wind fits your company," said Ed Weston, director of the Great Lakes Wind Energy Network, a Cleveland-based advisory group and network of manufacturers, which works to increase American-made parts used in wind turbines.
Wind energy in 2008 exploded across the United States, with 8,500 megawatts of new wind-power capacity, enough to supply more than 2 million homes. Total capacity stands at 25,300 megawatts, putting the United States ahead of Germany as world wind-power leader.
This year -- because of a lack of financing, said Weston -- new capacity is expected to fall to about 5,800 megawatts, still the second- or third-highest amount ever added.
Pennsylvania has 320 wind turbines generating enough power to handle 179,000 homes' electricity needs, according to the association. The state ranks 15th in existing capacity among all states. An additional 136 turbines are under construction.
The state is home to the U.S. headquarters of Spain's Gamesa Corp. and two manufacturing plants.
With an average utility-size wind turbine containing 8,000 parts, opportunities seem to abound for domestic suppliers. But most of the eight wind turbine manufacturers operating in the United States are foreign-based. Experts say those companies don't know the capabilities of American suppliers or even where to look.
One regional company that has grown its wind-power-related revenue from zero to $20 million in six years is Hodge Foundry Inc., based in Greenville, Mercer County.
"In 2002, we determined we wanted to diversify away from our mining equipment base," said John McGoldrick, technical director at the 133-year-old, privately held Hodge, which was acquired in 2008 by Elyria Foundry Co. of Ohio.
"We're working with Clipper Windpower (of Carpinteria, Calif.), with 40 percent of our revenue coming from our wind business," McGoldrick said. "Last year, we had $50 million in total sales, a record for us."
Weston said cracking the wind power business can be difficult, that manufacturers demand tighter specifications than the aerospace industry, that companies must know or hire a consultant who knows foreign specifications and that the learning curve can be expensive.
"But there's a lot of potential work out there," he added.