Midwest States and Clean Energy
Indiana, Michigan, and Ohio State Programs to Attract, Retain and Retool Clean Energy Businesses
Clean energy businesses help reduce greenhouse gas emissions through renewable energy and energy efficiency. They enable technology, such as advanced batteries, for hybrid and electric vehicles, which reduce gasoline consumption, and they create jobs in new and growing sectors of the economy.
States have taken a variety of approaches to attracting these businesses. Several states pursue industry sector “clusters” and related supply chains, whether solar, wind or automotive.
Many have successfully attracted global companies’ U.S. or North American headquarters. In some instances, federal stimulus money, along with state incentives, factored heavily in business attraction and retention in recent years. For the states, especially in this economy, energy policy means jobs and manufacturing.1
With fewer state incentive programs, loan guarantees or federal stimulus funds, some predict a shift back to large projects not dependent on such funding. While the costs of wind and solar have fallen, they compete with fossil fuel-fired power, including growing reserves of natural gas, and face uncertainty over the extension of production tax credits for wind and solar.
The Midwestern United States have long been a center of the country’s traditional manufacturing sectors, and these states are active in drawing clean energy businesses. Indiana, Michigan and Ohio have attracted and retained advanced manufacturing clean technology companies in the wind, solar, electric vehicle and hybrid battery sectors. They have done so through a mix of local, state and federal tax incentives, skilled workforce, manufacturing capability, central location, access to customer and supply chains, university R&D and workforce training programs. The auto industry started rebounding in 2011, with projections of increased sales and jobs.2
A corporate vice president extolled the Midwest’s virtues for advanced batteries and the auto industry:
…The labor pool has great automotive integration experience. If you look at the structure of the industry, there's a huge corridor in the Midwest region, including Indiana, Michigan and Ohio. If you map our suppliers and our customers, they fit down that band in the middle of the country.3
1 The Federal Reserve found that Midwest manufacturing increased 12.5% from March 2010 to March 2011. http://www.chicagofed.org/digital_assets/publications/cfmmi/2011/cfmmi_march_2011.pdf
3 Jeffrey Seidel, Vice President of Corporate Strategy for Ener1, Case Study: EnerDel, November 2009, http://www.edf.org/page.cfm?tagID=48923.