Renewable energy requirements that will help Ingeteam Inc. thrive in Milwaukee’s Menomonee Valley are a threat to businesses already in Wisconsin, according to a statewide business group.
“Wisconsin’s not going to be able to attract businesses to our state if we continue to make electricity more expensive here than it is in other states and other countries,” said Scott Manley, environmental policy director for Wisconsin Manufacturers and Commerce.
The company will flourish at its proposed Milwaukee location with the city’s skilled work force, access to transportations hubs, local college programs and state requirements for renewable energy, said Aitor Sotes, CEO of Ingeteam’s U.S. subsidiary.
The company plans to start building a $15 million manufacturing plant in Milwaukee in April and create as many as 60 jobs in 2011 and 275 jobs by 2015.
“We believe that with the current state of policies set in place, we can grow, and I think we can develop our market here,” Sotes said. “Certainly, we’re going to support any measures to expand incentives for renewable energy because those will help us grow at a faster rate.”
The Milwaukee facility would be Ingeteam’s first in the U.S. The company will manufacture generator and electricity conversion equipment for wind turbines and solar power generators.
Ingeteam has not yet selected a general contractor for the project but has hired MSI General Corp., Oconomowoc, to design the building, Sotes said.
Jobs such as those Ingeteam will create will continue to come to Wisconsin if there are more state and federal renewable-energy regulations, such as the proposed Wisconsin Renewable Energy Portfolio, said Richard Leinenkugel, Wisconsin Department of Commerce Secretary.
The portfolio, which was introduced to the state Legislature in January, sets a goal of 25 percent of the state’s electricity coming from renewable sources by 2025.
“What we do in terms of government policy is to set the standard,” Leinenkugel said, “and those private businesses go out and create product to meet the standard.”
Commerce is offering Ingeteam $4.5 million in state tax credits if the company creates 275 jobs, Leinenkugel said. The agency also offered a $500,000 forgivable loan for construction costs.
But WMC remains opposed to the renewable-energy legislation because it would kill more jobs than it would create, Manley said. He cited a Public Service Commission of Wisconsin study of the 25 percent goal that reported it would cost $15 billion to build enough wind farms to meet the target.
The cost of building those farms will drive up electrical rates, which will drive companies out of Wisconsin, Manley said.
Yet the wind farm projects would expand the market for companies such as Ingeteam, said Rocky Marcoux, Milwaukee Department of City Development Commissioner. And, he said, he welcomes the prospect of any such growth.
“Anything that happens on a governmental level,” Marcoux said, “is only going to increase their ability to expand here.”
Manley said there would be more lost than gained through the state legislation and cited a study of the effect of renewable energy requirements on jobs in Ingeteam’s home country of Spain. That study, by King Juan Carlos University in Madrid, counted 2.2 jobs lost in Spain due to the requirements for every one job created.
“The question,” Manley said, “about whether or not you create jobs by making energy more expensive — I think, intuitively, the answer is no.”