In my 20-plus years of experience covering assorted metalworking industries, I have observed countless petroleum pricing cycles as they waxed and waned their way through the domestic economy. Along with these cycles, politicians would discuss how important alternative-energy technologies and infrastructure were to America’s future.
Industrialists would wring their hands about soaring energy costs and work out strategies to minimize consumption. Journalists like me turned the price cycles into column-inches. And consumers would just pay higher energy prices, perhaps driving less than normal or adjusting their home thermostats.
Statistical examination of petroleum prices during the past several decades shows that their cyclicality, of itself, is a benign economic trend typical of many commodities. Rather, the trend of greatest concern was that, for petroleum, these cycles occurred at ever-higher price points with time’s passage. By now, all should know that the petroleum pricing model continues to factor in the realities of crude oil as a geographically concentrated commodity of finite supply for which the world increasingly thirsts. In other words, don’t expect the bottom to ooze out from oil prices any time soon.
Given this backdrop of generally increasing energy costs, I enthusiastically applaud the foresight shown by senior management at Lincoln Electric Company, headquartered in Euclid, Ohio, on its decision to proceed with the installation of Ohio’s largest wind turbine on its property and do its share to set an energy example for corporate America. That example is to let American companies know that they are not entirely fettered by the price of conventionally generated energy in pursuit of their business interests.
Poised to take advantage of the winds off Lake Erie, Lincoln Electric’s 2.5-megawatt wind-turbine project will end up costing about $6 million. Although it received some seed money from the American Recovery and Reinvestment Act’s State Energy Program, the company reached deep into its own treasury to cover $4.5 million of the total cost. At an estimated annual savings of $500,000 off its electric bill, the company’s payback for the project will run about nine years. However, the benefits gained by the company in terms of goodwill and marketing value effectively lessen the payback period.
Lincoln Electric committed to this project partly in support of the Great Lakes Energy Development Task Force, which seeks to establish the Cuyahoga region as a hub for wind energy. Lincoln showed great judgment in doing so, for not only does their action support a regional effort and lower company energy bills, but it also highlights the considerable amount of welding involved in fabricating a wind tower and showcases the automated techniques involved in laying those welds. And, by no means lost to this publication’s readers, a good number of high-value forged rings, gears and shafts are used in wind turbines as well.
I know there are at least a few readers of this column that have occasion to travel I-90 through Euclid, Ohio. When they do, I hope they’ll look inland toward the spinning air turbine blades that will soon grace that skyline in recognition of the energy emancipation and the corporate leadership they represent.