Indiana Clean Energy and Economic Development Policies

February 12, 2012
by Ann McCabe

View Other Midwest Clean Energy Policy Approaches


Dan Hasler, Indiana Secretary of Commerce and CEO of the Indiana Economic Development Corporation, said that the state aggressively markets their business-friendly climate, workforce, logistics, and university system and makes incentives available to all employers choosing to locate and expand in Indiana.  Governor Mitch Daniels’ approach has resulted in the state attracting more clean energy businesses as the location for their operations.

Green jobs account for 1.7 percent of the state’s total employment, according to a survey by the Indiana Business Research Center and the Indiana Department of Workforce Development.4

The Indiana Economic Development Corporation (IEDC) focuses on attracting new businesses to the state and growing and retaining existing businesses. Established in February 2005 to replace the former Department of Commerce, the IEDC is organized as a public-private partnership governed by a 12-member board chaired by the Governor.
 

Indiana offers a variety of programs to support new business start-ups and business expansion:

  • The Economic Development for a Growing Economy (EDGE) program offers a refundable tax credit when Indiana companies compete against another state or country for a company's site location investment. The company must commit to maintaining operations in Indiana for at least two years beyond the term of its award.5
  • The Skills Enhancement Fund offers grants that reimburse a portion of a company’s eligible workforce training costs over a two-year term.6
  • The Hoosier Business Investment Tax Credit encourages capital investment,7  the 21st Century Research and Development Fund helps develop and commercialize technologies,8  and the Industrial Development Grant Fund9 provides financial support to local governments for off-site infrastructure associated with an expanding or new facility.
  • Indiana has no gross receipts tax or inventory tax, and in the 2011 legislative session lowered the corporate income tax from 8.5% to 6.5%, phased in over four years.


Batteries:

  • Indiana is home to established and emerging battery technology companies, including Delphi Electronic & Safety,10  the only U.S. manufacturer of hybrid power converters, controllers and battery packs, and Altairnano, a battery manufacturer.  “Indiana offers a great business environment to support Delphi as we apply our strong technology heritage to the expanding ‘green’ industry of hybrid and electric vehicles,” said Jeff Owens, vice president of Delphi Corporation and president of Delphi Electronics & Safety. “With support at the federal, state and local levels, we will work to develop new production capacity for power electronic products that can help meet two critical government and industry goals – reducing dependence on petroleum and reducing greenhouse gas emissions – right here at the ‘Crossroads of America.’”11
  • Altair Nanotechnologies, Inc., or Altairnano, a leading provider of lithium-ion energy storage systems and batteries, has a 70,000 square foot manufacturing facility in Anderson, Indiana, chosen in part because of "a growing base of potential long-term clients including Phoenix Motorcars and the AES Corporation, among others."12

 

Wind:

On September 13, 2011, Gov. Daniels and Evansville Mayor Jonathan Weinzapfel welcomed wind turbine blade manufacturer Global Blade Technology and 400 jobs to Evansville, IN.
 
  • Indiana has viable wind pockets in the northern half of the state, and the state estimates that power generation from wind turbines will more than double in coming years.13   In 2010, wind provided 2.4% of Indiana’s power, and the state now has voluntary renewable energy goals.  Big wind industry players such as Horizon Wind, BP Wind Energy, Duke Energy, EnXco, Brevini Wind USA, ATI Castings, Fairfield, VAT, White Construction, and Orion Energy have completed wind projects in the state.  A state-led wind working group has met quarterly since 2005.
  • Brevini Wind USA14  relocated its North American HQ and sited its first U.S. wind energy component manufacturing facility in Yorktown, Indiana.  Brevini’s 6.4MW Test Bench more than doubles the size of both GE’s 1.5MW Test Bench in Erie, PA and the US DOE’s National Renewable Energy Lab’s 2.5MW Test Bench in Golden, CO. This state-of-the-art machinery will result in many wind turbine manufacturers selecting Brevini’s facility to certify their equipment. The IEDC offered Brevini up to $3.9 million in performance-based tax credits and up to $300,000 in training grants based on job creation plans.  Delaware County will provide the 20-acre site for the new facility, property tax abatement and extended rail service to the site with the assistance of a state grant.
  • The Indiana Economic Development Corporation offered Global Blade Technology (GBT) USA, Inc. up to $2.8 million in performance-based tax credits and up to $200,000 in training grants based on job creation plans. The city of Evansville is receiving a federal Community Development Block Grant from the state Office of Community and Rural Affairs for purchase of capital equipment. Also, the city of Evansville is offering the company a 10-year Evansville Urban Enterprise Zone Investment Deduction and a loan through the Evansville Revolving Loan Fund (RLF).15
  • WindStream Technology manufactures small scale wind turbines called TurboMills™ and is investing several million dollars to establish operations at the Purdue Technology Center in Southeast Indiana.  WindStream President Dan Bates credits the move to the state’s manufacturing expertise, location, and up to $1.5 million in performance-based tax credits and up to $84,500 in training grants based on job creation plans. His business goal is to provide the world a “good that would reduce our carbon footprint.”16

  • Vela Gear Systems has proposed a wind turbine gear factory through a public-private partnership with the City of Marion that would create an Indiana Certified Tech Park for renewable and green companies.  Vela’s Noel Davis said Indiana is attractive because of its low transportation and labor costs, manufacturing experience, proximity to wind farms and steel, and skilled machinist population. The Tech Park designation provides up to $5 million in state funds for infrastructure.  Other funding includes bonds through the Indiana Finance Authority, performance-based tax credits from the IEDC, a DOE tax credit and a U.S. Department of Commerce grant.  Vela has orders for gears; once it secures a financial partner to convert the bonds, it will build the facility and begin production and create 150 jobs by 2013.

 


Solar energy:

  • Indiana’s solar supply chain includes 35 companies.17  The state created a solar energy working group in 2010 that meets quarterly.  Abound Solar18 is building the largest U.S. solar panel manufacturing facility in Tipton, which will employ 850 people.  The Colorado-based company will produce solar modules that significantly reduce the cost of generating solar electricity.19
  • In June 2011, Fronius USA, LLC announced it would locate a solar inverter manufacturing facility and their U.S. headquarters in Portage, IN.20  The Indiana Economic Development Corporation offered Fronius up to $4.25 million in performance-based tax credits based on the company's job creation plans. The city of Portage will consider additional property tax abatement.   While the company began by producing battery charging devices, since 1991 it has been on the forefront of solar inverter technology and production.

 

 


4 “Global Wind Manufacturer to Locate in Southern Indiana,” September 13,2011, http://bit.ly/yQHXpv/
5  Other tax credits include Hoosier Business Investment, Headquarters Relocation, Industrial Recovery, R&D tax credits and Venture Capital Investment Tax. The 21st Century Research and Technology Fund financially supports companies developing and commercializing advanced technologies.   http://bit.ly/n1ezxc
6  http://iedc.in.gov/programs-initiatives/skills-enhancement-fund
7  http://iedc.in.gov/tax-credits-exemptions/tax-credits/hoosier-business-investment-tax-credit
8  http://iedc.in.gov/entrepreneurship/21st-century-research-and-technology-fund
9  http://iedc.in.gov/programs-initiatives/industrial-development-grant-fund
10  http://delphi.com/
11  Jeff Owens of Delphi quote provided by IEDC.   Also see http://delphi.com/news/pressReleases/pressReleases_2009/pr_2009_12_18_001/.
12  http://www.green.autoblog.com/2008/04/04/altairnano-expands-indiana-facility/
13  Indiana projects it will go from 800 wind turbines to over 2000 and from 1,339 MW to over 4,000 MW.
14  http://www.breviniusa.com
15  http://www.tradeandindustrydev.com/region/indiana/news/in-global-wind-blade-manufacturer-locate-southern--5633.
16  “A California Entrepreneur’s Story: Dan Bates, November 10, 2011 and “Wind Energy Firm to Locate Development Center at Purdue Research Park,” November 23, 2009 Indiana Economic Development press release. 
17  Report provided by Indiana Office of Energy Development.
18  http://abound.com/
19  http://bit.ly/i9blOt
20  http://www.fronius.com/ and IEDC June 23, 2100 press release, “International Technology Company to Relocate U.S. Headquarters to Porter County from Michigan.”