Three trillion dollars in federal green-energy money has some towns digging in; others 'have been burned before' - Entrepreneur Generations

Map by The Wall Street Journal; for a larger version, click on it.

"Go big or go without." It's a worry some rural communities are grappling with as they consider trusting a "made-in-Washington initiative that demands small communities around the country commit significant local resources to attract businesses, sometimes in unproven industries. Some have been burned before," report Phred Dvorak and Amrith Ramkumar of The Wall Street Journal. Federal offerings include "One trillion in federal tax incentives and loans for green energy. . . [It] is one of the biggest outlays of taxpayer-financed industrial stimulus since Franklin D. Roosevelt's New Deal. . . . If successful, it could transform the nation's economy by creating millions of jobs and driving up to $3 trillion in total clean-energy investments during the next decade."

Colleton County, South Carolina, is an example of a town that successfully went big. "It's a quiet rural district best known for hunting, fishing," Dvorak and Ramkumar write. "In December, Colleton snagged a $279 million investment from Kontrolmatik Technologies Energy and Engineering, a Turkish firm that is hoping to get nearly $1 billion in federal tax credits over the next decade by building a battery-making plant in the U.S. . . . Kontrolmatik wants to tap into the renewable-energy sector's need to store electricity for release onto the grid when the sun isn't shining or the wind isn't blowing. . . . It promises to employ 575 people at some of the highest wages around. In return, the state and county are offering land, grants and local tax breaks."

The Journal reports, "More investments will come after the Treasury Department clarifies the fine print of how the tax credits will work. SolarEdge Technologies Inc., which makes equipment that converts energy from the sun into electricity, will invest between $125 million and $250 million in its first factory in the U.S., depending on how Treasury characterizes its devices, chief financial officer Ronen Faier said. . . . Large swaths of the investment so far are flowing to southern, Republican-leaning states such as South Carolina, Georgia and Tennessee that generally have lower labor costs and taxes."

Not everyone agrees that federal incentives are a positive. "Skeptics warn the subsidies could stoke already high inflation and waste money without creating lasting economic benefits. Some of the proposed investments will flop or never materialize. . . . particularly for new technologies such as clean-hydrogen production," The Journal reports. " Some small communities, which have been through booms and busts caused by fickle federal incentives, aren’t betting the farm this time. In 2007, state and local leaders offered millions of dollars to attract TPI Composites, a wind-turbine blade maker, to Newton, Iowa, to make up for the closure of a big Maytag appliances plant. . . . . But by 2021, TPI’s Newton plant was struggling from the high costs of U.S. manufacturing and the looming expiration of a federal tax-credit program. That December, TPI closed the plant."

from The Rural Blog https://ift.tt/4R9bzpt Three trillion dollars in federal green-energy money has some towns digging in; others 'have been burned before' - Entrepreneur Generations

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