The best producer of wind blades in the world is right here in Aberdeen, Richard Morrison, CEO and president of Molded Fiber Glass Companies, said Thursday at the Aberdeen Development Corp. annual meeting.
Morrison spoke about the success of the MFG plant in Aberdeen, which began operations in 2008.
Since the Aberdeen plant opened, 2,450 wind blades have been produced. One hundred blades will be built this month, he said. The 40-meter blades are used in wind turbines to produce electricity.
The Aberdeen plant employs 400 workers and has a $16 million annual payroll. MFG has shipped blades to 16 states and two countries.
Jim Barringer, executive vice president of the development corporation, said the addition of MFG to the community was an important factor in helping Aberdeen weather the national economic downturn, which started in late 2007.
On multiple measures, Aberdeen has fared better than the rest of the country. It has also fared better than its sister cities in South Dakota, he said. For example, when employment figures are tallied for 2008 through 2011, it shows that Aberdeen was the only city to show a net gain in jobs, Barringer said. While the net gain was 0.2 percent, it was better than Sioux Falls, which showed a .06 percent loss. Other larger cities had losses of up to 3.4 percent.
Aberdeen also showed a net gain in annual worker pay of 11.1 percent, the highest in the state, he said. Unemployment rates have been low.
The unemployment rate in Aberdeen in May, the most recent month for data, was 3.5 percent, according to the South Dakota Department of Labor. That figure was lower than rates for Sioux Falls, Rapid City and Watertown. Brookings had the same rate.
"By all indications, we are seeing good economic growth in the community," Barringer said.
While MFG has had great success, that success is threatened by the potential loss of the federal production tax credit, Morrison said. The credit is set to expire Dec. 31 if Congress does not renew it. Companies that sell wind energy are allowed to take 2.2 cents per kilowatt hour tax credit, which makes wind energy more affordable to consumers.
"Industry experts say that business could fall by 80 percent if the tax credit is not renewed," Morrison said.
South Dakota's congressional delegation has come out in favor of extending the tax credit, but many senators and representatives have yet to throw their support behind it because they say it is a subsidy the country cannot afford. Morrison said he and others in the wind energy industry have been lobbying Congress.
A long-term extension of the tax credit would be beneficial, Morrison said, but he expects only a short-term extension at best.
"There is a lot of gridlock in Washington," he said.
Morrison gave credit to the management team in Aberdeen led by general manager Dave Giovannini for plant's success.
He also thanked the development corporation for its support.
The corporation owns the building where MFG operates. That plant has an assessed value of $17.8 million.
When MFG was looking at cities where it could build a new plant, Aberdeen was the most welcoming and helpful city, Morrison said.
Barringer said 18-19 governmental and private funding sources, including loans from seven local financial institutions, were put together to get the MFG plant up and running.
The efforts showed how the community came together to make economic development possible, he said.