Speculation has been swirling for a few months now that legislation would be passed putting the kibosh on the big 600MW Texas wind farm being developed by Shenyang Group (which A-Power has majority ownership of) and a few US based companies such as US Renewable Energy and Cielo Wind.

A few Democrats aren’t all that thrilled that China based A-Power Energy is playing such a big part, supplying the turbines for the project. According to TheStreet.com, Charles Schumer and three other senators introduced legislation to limit stimulus cash to green projects that encourage US job growth and have asked Obama to suspend payments until Congress comes to a consensus on the issue.

The Texas wind farm is expected to receive several hundred million in stimulus funds, but the wind turbines will be manufactured in China and expected to only create temporary jobs in Texas. Schumer points out that 3000 China employees will be used to build the turbines and only 300 Texas employees to install them.

Of course Schumer’s comments have angered the companies involved in the project. US Renewable Energy Group argues that a minimum of 70% of the turbine components will be American made and be composed of 100% US steel. They also say that because of the wind farm, APWR will be able to open a US manufacturing plant to manufacture turbines here, employing up to 1000 US workers. I assume they mean for future US projects that APWR would be a part of. The first shipments of the turbines for the Texas project are expected to begin shipping this month.

This issue will likely weigh on the stock for sometime despite the fact the project continues to move forward. Shares are down again today despite a strong overall market.

Reprinted with permission from Green Stocks Central