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General Electric is laying off staff at its onshore wind power unit as part of a restructuring that came in response to the underperformance of the business. The company will reportedly cut its U.S. onshore wind workforce by 20 percent.
According to a Reuters report citing unnamed sources familiar with the situation, GE’s onshore wind power business has been troubled by rising raw materials costs, weakening demand, and supply chain snags.
The weaker demand came in response to the expiry of renewable power tax credits that made wind and solar cheaper than most alternatives.
"These are difficult decisions, which do not reflect on our employees' dedication and hard work but are needed to ensure the business can compete and improve profitability over time," GE told Reuters in response to questions about the information.
Onshore wind power capacity in the United States has been rising strongly in the past years, while offshore wind has yet to take off. The Biden administration has big plans for wind, along with other low-carbon energy sources, focusing on offshore wind.
As of the second quarter of this year, there was some 139.145 GW of installed wind power capacity in the U.S. Despite federal government ambitions, however, the industry has been complaining about raw material prices and supply chain problems since the pandemic began to ebb.
Recently, the wind power industry came into the spotlight in an unusually negative light as pressure from environmental activists prompted the Fish and Wildlife Service to review the rules for eagle conservation.
Several major wind power companies including NextEra have in recent years become the target of successful litigation because their turbines kill eagles. Now, the Fish and Wildlife Service says it will tweak its permitting program in such a way as to both encourage more wind turbines to be installed and make sure that fewer eagles end up killed by these turbines.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com