Cynthia’s Neighborhood

More than eight out of 10 US stimulus dollars spent on wind energy farms have gone to foreign companies, according to a report by the Washington-based Investigative Reporting Workshop, a non-profit journalist group.

Of the $1.05bn handed out in grants so far – most of it since August – 84 per cent has gone to European companies, with the US subsidiary of Iberdrola Renewables, the Spanish company, taking the largest share.

Obama administration officials say the $22bn set aside in the $787bn stimulus for alternative energy funding is designed to create or retain jobs and stimulate economic activity. But the report, shared with the Financial Times, shows the majority of jobs are likely to have been created overseas.

The 11 US-based wind farms that received cash grants from the US Treasury have imported 695 of the 982 wind turbines that are to be installed. Since the manufacture of turbines is by far the largest employment generator in wind energy, it is estimated to have created 4,500 jobs overseas – far in excess of the jobs created in the US from these grants.

The IRW report comes amid a broader controversy over the jobs impact of the economic stimulus, with the White House on Friday set to provide an estimate of how many jobs the stimulus has created or saved so far. On Wednesday, the White House strongly rebutted claims by the Associated Press that the administration had overstated by a sixth the number of jobs created by the stimulus.

AP cited several examples, including that of a company working with the Federal Communications Commission, which the Obama administration said created 4,231 jobs, but that AP said had only resulted in 1,000 new positions. The White House said the agency had exaggerated its findings and had analysed only 2 per cent of stimulus spending. “This story draws misleading conclusions from a handful of examples,” said the White House.

The IRW’s findings on the results of stimulus spending on wind energy, which could exceed $3bn when the next round of grants are disbursed, highlights the weak condition of the private US alternative energy sector. The administration may face similar public relations problems when it announces awards to other sectors, including solar power, in the coming months. Even though US companies invented solar photovoltaic technology, the US accounts for only 10 per cent of the global solar component market.

During the election campaign, Mr Obama said that investments in alternative energy would create a new generation of green jobs. But the IRW report, which can be found atinvestigativereportingworkshop.org, illustrates how difficult this may be to achieve.