Analysis: Obama's rosy takeon Toledo imprecise

At a Columbus neighborhood meet-and-greet Wednesday, the President was asked a question by a Toledo native who wanted to know the long-term prospects of union pensions and manufacturing jobs.

This, in part, is how the President responded:

“Toledo actually is becoming a leader in [clean energy], creating good jobs, in areas like solar — building solar panels, wind turbines, advanced battery manufacturing.”

As one might expect, President Obama's statement thrilled Toledo community and business leaders, even if what the President said wasn't entirely accurate.

“We would certainly want the President of the United States to talk about us that way,” said Steve Weathers, a top economic development official in the region. “Even if he's a little bit off, we can't fault him for it. We'll correct it later.”

Mr. Weathers, president and chief executive of the Regional Growth Partnership, said he was not aware of any wind turbine or fuel cell battery manufacturing in Greater Toledo. And a University of Toledo spokesman said that while the university is involved in wind turbine, fuel cell, and energy storage research, it's not partnering with any turbine or battery makers on a project as it routinely does in the solar industry.

Setting aside for a moment Toledo's place in solar research, development, and manufacturing, Toledoans don't make wind turbines or fuel cell batteries — at least not yet. And the region's limited participation in wind and battery product supply chains makes it difficult to judge its economic impact.

For instance, the Ohio Department of Development lists companies throughout the state that are “active” in the wind-supply chain. Of the eight companies listed in northwest Ohio, only three are in Lucas County.

One of them is Owens Corning, which is the leading supplier for glass fiber reinforcements for wind turbines in the world but has no manufacturing operations here.

So whoever is actually making those reinforcements for wind turbines isn't collecting paychecks or paying taxes in Toledo.

Another company, Surface Combustion Inc. of Maumee, makes furnace and industrial heating equipment found in the tower of a wind turbine.

But Ben Bernard, a business development official with the company, said wind energy is only a small portion of Surface Combustion's business and not a job creator for his firm.

“The number of active projects in the wind-energy field has actually tapered off,” Mr. Bernard said.

According to the Ohio Fuel Cell Corridor, the only parts supplier for fuel cell batteries in the region is Perrysburg's Bulk Molding Compounds Inc.

Could Mr. Obama, who won Lucas County in 2008 with 65 percent of the vote, really be that out of touch with his constituents to mistakenly claim jobs were being created in two clean-energy sectors at a time of crushing unemployment, high foreclosure rates, and dwindling tax bases in the region?

Or were the President's exaggerations simply something a politician does when on the campaign trail, which was one of the reasons Mr. Obama was in Columbus on Wednesday — raising money and stumping for Ohio Gov. Ted Strickland?

White House officials say no on both counts, insisting that the President was using Toledo's achievements in the solar industry as an example of how a manufacturing community can reinvent itself within the clean-energy economy.

White House staffers who were with Mr. Obama in Columbus said he was referring to the 1,000 employees at thin-film solar panel maker First Solar's plant in Perrysburg Township, the millions of dollars spent on photovoltaics research conducted at the University of Toledo, and local solar start-up firms such as Xunlight Corp. and Willard & Kelsey Solar Group.

Those officials said Mr. Obama listed wind and advanced batteries as broader examples of clean-energy manufacturing to illustrate what the President said Wednesday were sectors “we end up being world leaders [in] and, as a bonus, end up creating a more energy-efficient economy that is also good for the environment.”

It's certainly possible that's what the President meant, but Mr. Obama also was caught in a misstep Wednesday when he inaccurately credited his federal stimulus package instead of congressional earmarks for aiding a renovation project at a Columbus police station.

Moving past the semantics debate, it's worth delving into the issue of Toledo's place as a “leader” in the solar industry.

In March, The Blade published a three-day series of reports that showed Ohio had, despite its early success in the solar industry at UT and First Solar, lost out on thousands of solar manufacturing jobs in the last few years to states offering more lucrative incentives and stronger product markets for solar companies.

Because of state government subsidies and more solar consumers, states such as California, Oregon, Arizona, and even Ohio neighbors such as Michigan and Pennsylvania have attracted dozens of solar manufacturing operations over the last few years. The soft estimate of 6,000 solar jobs in Toledo now is the same estimate from 2007 when the region was dubbed a solar “hot spot” nationally.

First Solar may now employ 1,000 people at its Perrysburg Township plant with an average starting wage of $12 per hour for its factory workers, but its headquarters are in Arizona and most of the $2 billion-a-year company's production takes place in Germany and Malaysia.

First Solar's local 212-megawatt plant soon no longer will be the largest in the United States; SolarWorld's Oregon plant is expected to expand to 500-megawatt annual capacity and 1,000 employees by October.

Xunlight, a UT spin-off and flexible solar panel maker started by faculty member Xunming Deng, has between 100 and 120 employees and about $80 million in signed contracts, according to Mr. Deng. But the company has yet to hire additional employees despite millions received in public loans as it continues to work on improving its production process.

Willard & Kelsey, an aspiring panel maker in Perrysburg, has on several occasions failed to achieve its predicted employment numbers and has been sued for failure to fill a contracted order. But the company now says the issuance of a $10 million loan from the state should help it grow from 70 to 200 employees and ramp up production by year's end.

Solar research at UT has only been intensified under university President Dr. Lloyd Jacobs, but larger, better-funded research institutions such as the University of Michigan, Stanford University, and the Massachusetts Institute of Technology are studying the same topics and working to spin off more solar companies.

Globally, the United States is poised to be outspent 3-to-1 by China, Japan, and South Korea in all clean-energy investment over the next five years, according to a 2009 study by the Breakthrough Institute. The same study indicated that those Asian nations already had passed this country by in “virtually all clean energy technologies.”

Put another way, competition abounds.

“California has kind of always been the leader of the pack [in the nation], with all the investment and development in Silicon Valley,” said Rhone Resch, Washington lobbyist for the Solar Energy Industries Association. “You've got Oregon, you've got Ohio because of Toledo, and there is Michigan. Arizona is making huge headway, as is Georgia and North Carolina, in attracting new companies. But it's a global race and it's not over. It's just beginning.”

Toledo is, despite economic turmoil and the fierce competition it faces from around the world, at the very least a factor in the solar race. And if the region's local firms and UT continue to make strides, if the renewable energy mandates set up by Mr. Strickland take hold, and if the United States solves some of the trade issues often blamed for the decline in manufacturing — that's a lot of ifs — Toledo could certainly remain competitive with the possibility of real economic gain following behind.

The region also may benefit from Mr. Obama's remarks last week, inaccuracies and all.

“I'm grateful the President recognized Toledo for solar manufacturing and as a leader in innovation,” said Mr. Deng of Xunlight. “Maybe a bigger market and more outside investment in this area will follow? What he said really could have a positive impact.”

Contact Joe Vardon at:jvardon@theblade.comor 419-724-6559.