Friday, November 20, 2009

More on John Carney and DelaWind

Writing in the News Journal, Aaron Nathans has an update on DelaWind's efforts to build wind power towers for Bluewater Wind. DelaWind, which is now 95 percent owned by Amer Industrial Technologies, expects to create 567 jobs at its Edgemoor plant and another 116 jobs at Evraz Claymont Steel if it gets the business.
One might think that an effort to create hundreds of heavy manufacturing jobs would be greeted enthusiastically, but a few grumpy souls like state senator Joe Booth and Dave Burris are complaining because of John Carney's involvement in the project. Booth is remarkably sanguine about the 600+ jobs the venture would create. Carney shows more of a sense of urgency:
"Somebody's got to make them. Are they going to make them here in Delaware? Are they going to make them in Maryland, in New Jersey? Where?" Carney said in a recent interview.
Burris calls the firm "John Carney’s Delawind." But as I wrote three weeks ago, and Nathans confirmed today, Carney, who does not have an ownership stake in DelaWind, will no longer work for the firm as of January.
Three weeks ago, I wrote, "I don't know anyone who wouldn't like to see Delaware steel workers play a significant role in building this historic project." It seems I was wrong.


Blogger a most peculiar nature said...

I have to agree with you here. I don't see any evidence of shenanigans, and as you say Carney does not have an ownership stake. So what's the beef?

I would like to see the details of their submission and if there were any competing submissions, but other than that I think we should encourage this effort, not put partisan roadblocks in front of it every step of the way.

It is simply bad form.

3:54 PM, November 20, 2009  
Anonymous Edmund Dohnert said...

It's been really deplorable how much wind power for Delaware had become (and evidently still is) a political football.

Having said that, I think that we should take these job creation estimates with a very large grain of salt. It seems that whenever somebody wants to get their snout into the government feed trough, they bandy about all sorts of wildly optimistic projections of the number of jobs that would result if only the state gave them some money to get started. Hell, even these guys who want to start a french fry vending machine business claimed it would create several hundred jobs.

I very strongly suspect that this DelaWind estimate of over 500 jobs (or over 600 if you include Claymont Steel) is overly optimistic by at least a factor of two. It probably assumes full-capacity manufacture and several shift going full blast. Not likely in the real world. Large-item steel fabrication is not all that labor-intensive, and I really have a very hard time seeing this DelaWind venture ever employing that many people devoted to making towers for wind turbines. I have viewed several videos of wind tower manufacture and construction, and it doesn't take all that many people.

It's a shame, because only a few minutes ago I read on the Bloomberg website that Valero just announced it will be permanently closing the Delaware City refinery due to economic reasons. (It will also be closing its' Eagle Point refinery in New Jersey.) Man, what with Chrysler and GM, poor little Delaware has been taking some pretty bad employment hits lately.

5:56 PM, November 20, 2009  
Blogger Tom Noyes said...

Even if one is more conservative about the number of jobs created, 350 jobs for instance, the $350,000 investment (not spending, investment) would come to $1,000 per job--a pretty good return for any economic development agency.

8:58 PM, November 20, 2009  
Anonymous Edmund Dohnert said...

Tom -

Yes, it would be nice if even some of those projected jobs actually became a reality, but aren't we putting the cart way before the horse?

As yesterday's News Journal article pointed out, DelaWind has no contracts with NGR/bluewater, and would need to sell its towers to the project's turbine supplier, and not to Bluewater itself. Being that the project hasn't even started, much less a turbine supplier having been selected, there is currently no guarantee the DelaWind is going to be selling towers to anybody. What if whichever turbine supplier that is finally selected has other ideas as to how it will procure its towers?

And what if NGR doesn't get all the tax breaks and other government assistance that it says will be vital, and decides a year or so down the road that the project is no longer economically viable? Where would that leave DelaWind and the Delaware taxpayer?

Honestly now .... do you think this is such a promising enterprise that you'd invest a substantial amount of your own money in it right now? If not, then, as a Delaware taxpayer, why should I have to?

8:51 AM, November 21, 2009  

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