LM Wind Power will expand its Little Rock Port Authority facility as it combines its two plant operations in Little Rock, the Danish company announced Friday.
LM Wind Power, one of the industry's leading wind-turbine manufacturers, will build a new 44,000-square-foot warehouse and transfer 75 employees at its plant on Scott Hamilton Drive to its Port Authority location. The company employs about 450 people at its Port Authority facility.
The expansion will allow LM Wind Power to store materials on site and reduce transportation costs, the company said.
"This will not create new jobs, but this will give us the efficiencies we need," said Bill Burga, senior project director of global operations.
LM Wind Power held a groundbreaking for the new warehouse Friday.
"The Little Rock Port Authority is excited that LM continues to invest in the Little Rock Port and the Little Rock Port Authority," Chris Matthews, chairman of the Port Authority's board of directors, said during the ceremony.
The announcement of the expansion comes after several years of turbulent employment and business for LM Wind Power.
In recent years, the wind industry, including LM Wind Power, has struggled with uncertainty regarding the renewal of the federal production tax credit.
The credit of 2.2 cents per kilowatt hour of renewable power has expired but has been extended several times since 2012.
In 2012, as Congress let the tax credit expire, LM Wind Power, which had 391 workers in Little Rock at the time, cut 94 full-time jobs and 140 temporary positions.
By 2013, LM Wind Power had only 137 employees in Little Rock.
That same year, another wind manufacturer in Arkansas, Nordex USA Inc., halted production at its wind-turbine facility in Jonesboro and laid off about 40 employees. The company returned more than $2.5 million to the state for incentives it received and moved its operations to Germany.
The American Wind Energy Association says that in 2013, after the tax credit expired, installations of new wind farms declined 92 percent and the wind industry lost 30,000 jobs.
But business picked up for the industry when Congress extended the tax credit and allowed companies to qualify for the incentive if construction started in 2013.
With the overall increase in jobs came the addition of about 400 jobs at LM Wind Power's Little Rock facility, part of more than 850 jobs added nationwide.
In 2014, LM Wind Power repaid the state $3.4 million after a review found the company didn't meet employment terms of the state incentive package it received in 2007 to locate its plant in Little Rock.
When the company was offered the incentives, it was expected to employ about 1,100 workers.
Finally in December 2015, Congress extended the the production tax credit until 2019, with a phase-out period starting in 2017.
"It's been a little of a bumpy ride since the U.S. got active in the wind industry," Burga said. "Right now looking forward, it looks like we are stable. I think wind is finding its way."
Business on 04/02/2016