TPT November 2017

G LOBA L MARKE T P L AC E

Alex Morgan, a New York-based analyst at BNEF, said that turbines generally are not designed for hurricane risk. But John Martinez, director of operation at Pattern Energy Group, which owns the 283-megawatt Gulf Wind Farm in Kenedy County, noted that turbines will pitch down and yaw into the wind, which allows them to safely pinwheel. “This way the blades don’t flex, which can be damaging,” Mr Martinez told Bloomberg. “Turbines are designed to automatically do that.” The US jobs picture Manufacturing leads a healthy labour market, but employment gains do not yet entail faster wage growth The US Labor Department reported on 1 September that manufacturers nationwide added workers in August at the fastest pace in over four years. This confirms the rebound at American factories, which lost more than two million jobs in the recession of 2007-2009 but have recovered more than a million since 2010. A closely watched private survey released the same day showed US factory activity at a six-year high. Construction was another bright spot. An uptick in consumer spending also boosted the Commerce Department’s latest reading on economic growth earlier in the week. Of course, most of the factory job gains came under President Donald Trump’s predecessor, Barack Obama. But it is apparent that sentiment among both business leaders and consumers has improved markedly since Mr Trump’s victory in November 2016, with manufacturers stepping up the pace of hiring this year. Hiring in other sectors was less vigorous. The broader economy created 156,000 jobs, fewer than expected and well below the employment gains of earlier in the season. The unemployment rate edged up slightly to 4.4 per cent, while wages barely grew. One explanation for stagnant wage growth – even with low unemployment and steady hiring – is automation, as American workers in many fields are forced out of jobs that are taken over by robots. The jump in manufacturing and construction presents a sharp contrast with some service sectors (retail, leisure and hospitality, the public sphere) where job growth was much less impressive. Auto sales were down slightly in August, extending a soft trend. But employment at vehicle and parts factories, including truck makers, climbed by 14,000 in the month. Dorothy Fabian Features Editor (USA)

effects of rebuilding homes and replacing motor vehicles can last longer,” providing a lift to GDP in the fourth quarter and beyond. › At the time these views were sought, the storm seemed to have damaged things that can be replenished or replaced relatively quickly. The Times observed that Houston has huge economic assets that appear to be largely undamaged and are unlikely to be offline for very long. Moreover, they observed, factories and refineries are rarely running at full capacity; and, as they come back online, they can ramp up production to meet backlogs. Christopher Thornberg, founding partner of the consulting firm Beacon Economics, commented, “Businesses have stockpiles and the ability to catch up.” › For their part, the Times reporters predicted that, “as the floodwaters drain away and Texas shifts to clean-up mode,” followed by a mammoth effort to replace what was lost, the daily modes of commerce would shift but not stop. They wrote, “Disruptions, displacement and property damage are quickly followed by federal aid and insurance checks.” Texas excels in wind energy, easily boasting the most wind capacity among US states: about 21 gigawatts, or a quarter of national capacity, according to the American Wind Energy Association. Most of this output is sourced in western Texas, out of the way of Hurricane Harvey, which wrought havoc on Houston in August. Wind farm operators braced for the storm, evacuating person- nel as necessary; but in general their last day of operations was an ordinary one. Requiring no gingerly shutdown treatment, the big wind turbines turned off (automatically) in late afternoon, not to start back up again until the emergency had passed. The hurricane was packing top winds of 115 miles an hour on approach to landfall, according to the National Hurricane Center: more than twice the 55 miles-an-hour speed that prompts many wind turbines to shut off. The storm could have knocked out between 2.1 and 3.6 gigawatts of power near the Texas coast, according to Bloomberg New Energy Finance. But wind power looked like the least of the region’s power- market worries. As noted by Bloomberg, if hundreds of thousands of people were to lose power, as was expected, it would not matter whether the wind farms were running or not. They would have nowhere to send the electricity generated. “With gas plentiful and load down, I suspect the lack of wind won’t matter at all,” Cody Moore, the Houston-based president of BioUrja Group’s power trading division, told Bloomberg (26 August). “I’d be more concerned with the safety of the turbines than any need for load.” At least one energy sector has few preparations to make as a hurricane approaches: wind power

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NOVEMBER 2017