Wind farm factory runs out of puff: Danish owner says Australia too `unprofitable'

Canberra Times
Thursday 23/8/2007 Page: 13

A large world supplier of wind farm technology is turning its back on Australia, saying the nation's green energy market is not viable. Vestas Australia Wind Technology will close its unprofitable Portland turbine blade factory at the end of the year. About 130 jobs will be lost, casting doubts over the viability of Australia's renewable energy industry. The Danish company says it could no longer justify keeping the plant open because the investment was not worthwhile in the Australian market. Vestas Asia-Pacific senior vice-president Jorn Hammer said,"It's definitely a fact that the current environment for the wind industry is not big enough to encourage these kinds of investments.

"We have the view that if the Government steps up to the plate and puts the necessary security for a long-term market in place we'll have another look at the market, but I guess we'll be a little more careful next time. [Not] just believing in what they've been telling us, we need to see some hard evidence to justify investment."

A spokeswoman for federal Resources Minister Ian Macfarlane said Vestas made its decision to invest in Portland after the Government told the company it would not extend its Mandatory Renewable Energy Target. She said Vestas' decision to close was linked to new technology. "The blades they are manufacturing have been superseded and they have decided not to invest in the area," she said. "The Australian Government has invested heavily in both the manufacturing and renewable energy sectors with [the mandatory target] stimulating investment of over $3.5 billion and increasing wind capacity by 8000 per cent. "It is two years ahead of schedule so it shows just how successful the scheme has been."

Mr Hammer said Vestas had hoped to invest in new technology to develop blades for the Australian market but could not justify the outlay. Labor spokesman for the environment and climate change Peter Garrett said the closure was a kick in the guts for the renewable energy industry. He blamed the Federal Government's refusal to increase mandatory targets for the closure.

Victorian Minister for Climate Change Gavin Jennings also laid the blame for the closure on the Howard Government's failure to respond to the challenges of climate change. "This regrettable decision is a direct result of a lack of Federal Government support for the renewable energy industry." Last year, Vestas closed a similar $15 million factory in Tasmania, laying off 65 staff.

The Portland operation opened two years ago and produces export turbine blades. The company will continue to employ about 200 people around Australia in technical and support roles but its manufacturing operations here will cease. Mr Hammer said the company would fulfil its employee obligations and was working with the union to help workers find new jobs.