Thursday, February 25, 2010, 10:22am CST
City offers Yingli $354K incentive to move to Austin
Austin city officials are offering China’s second largest solar maker an incentive worth about $354,000 meant to lure the company to the Texas capital.
It’s an open secret that Yingli Green Energy Holding Company Ltd. (NYSE: YGE) is considering opening a North American operations, research and development hub in either Phoenix or Austin. The company is proposing an $18.6 million investment and creating about 300 jobs, according to the city documents.
Though the state has not commented on making its own incentive, many expect it will make a contribution.
Although the incentive package does insure the company is moving to Texas, it is a strong indicator Austin has become Yingli’s top choice only months after indications pointed to Phoenix. The turn of events is a huge win for Austin, which has struggled to land a major clean technology manufacturer, despite its reputation as a leader in renewable energy.
The fate of a $4.5 million federal tax credit, which the U.S. Department of Energy awarded Yingli to locate in Phoenix, is unknown.
Some speculated Yingli would be allowed to build its plant in another community, even though it listed the Arizona capital for its project location on a federal tax credit application. But a DOE spokeswoman said in an earlier email that if a project moves states, it is no longer eligible for the federal tax credit.
Despite the tax credits, Arizona’s solar industry launched itself into murky waters this week, as companies warned lawmakers a proposed bill could cripple the state’s nascent solar industry and send players to other states.
The bill would add nuclear and hydroelectric sources to a goal requiring utilities to get 15 percent of their power from renewable sources by 2025.
Included among the companies speaking out is Suntech Power Holdings Co. Ltd., which once considered Austin for a major plant. But Suntech, the largest Chinese manufacturer of solar modules, announced earlier this month plans to put its first U.S. facility in Goodyear, Ariz.
Officials said the state’s renewable energy standards were key to the choice of Arizona for the manufacturing base. Representatives of the solar industry met with Arizona Gov. Jan Brewer on Feb. 23, prior to the hearing on the new law. Suntech announced it was rethinking the Arizona location just prior to that.
It is unknown whether the bill played a role in making Austin attractive to Yingli, which his headquartered in Baoding, China, employing more than 6,000 worldwide.
More details could come to light when the company releases it Fiscal 2009 earnings on March 8.
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