Recovery dollars for foreign-owned companies

The Investigative Reporting Workshop at the American University School of Communication reports that a large portion of clean energy grant money has gone to foreign-owned companies.

Tue, Nov 03 2009 at 12:35 PM EST

Photo: madmack66/Flickr

Growth in the clean energy industry provides two important opportunities for our nation: getting Americans back to work and reducing our dependence on foreign oil. Clean energy grants provided through the American Recovery and Reinvestment Act have been making their way to companies for a few months now, but a new report from the Investigative Reporting Workshop (a project of the American University School of Communication) shows that a large portion of these grants have been awarded to foreign-owned companies.

The report tracked the $1.05 billion in clean energy grant money that has been awarded since Sept. 1, 2009 and found the following to be true:

84 percent ($849 million) was awarded to foreign-owned wind companies.
$800 million was awarded to projects that are already actively producing electricity.
$964 million was granted to wind projects while all other clean energy industries received a mere $89 million.
The American subsidiary of Iberdrola S.A., a Spanish company, has received 57.5 percent of the $1.05 billion disbursed since Sept. 1.

So this begs the question, are Recovery Act dollars, which are designed to help the United States recover from the economic crisis, being used in a way that will provide the most benefit to our nation?

Obviously, every American employed in the clean energy industry doesn’t work for an American-owned company. However, these foreign-owned companies do have operations here in the United States and provide much-needed jobs for American workers. So yes, the Recovery Act funding is leading to job growth here in the United States, but could the growth be higher if more funding made its way to American-owned companies?

This topic, Recovery grant money being given to foreign-owned companies, has sparked much debate. Last week, the Green Inc blog reported about a $1.5 billion wind farm planned for West Texas. Part of the financing from this massive project would come from Recovery Act grants with the rest coming from Chinese investors. While the wind farm would provide jobs and tax revenues to West Texas, the turbines would actually be made in China and then imported here to the States.

The article garnered a lot of attention with many readers crying foul about the use of American dollars to fund Chinese wind turbine employees. One of the readers posted the following comment:

"Great. So American workers loose [sic] out because the Chinese workers who live under a dictatorship will get the jobs so American investors can make a bigger return. Traitors!" (rmarc - Albany, New York)

Today, another Green Inc writer posted a follow-up to the original article. In his post, Of China, Texas and Green Jobs, Tom Zeller Jr. publishes a response from Cappy McGarr with the U.S. Renewable Energy Group. Here is an excerpt from McGarr’s response:

“The 600-megawatt project wind farm in Texas announced last week by the US-REG in partnership with a Chinese manufacturer and the U.S.-based Cielo Wind Power, LP will create American jobs, provide a local Texas economic ripple effect, and take America one step closer to energy independence. “ Source: Green Inc

Yes, the project will create good green jobs for Americans, but is it a wise use of Recovery Act dollars? I’d love to hear what you think.