Gov. Mitch Daniels is expected to be part of a group Thursday announcing that an Austrian company will build a new solar inverter manufacturing facility in Portage.
The U.S. Department of Energy approved the state of Indiana to provide Fronius USA $9.5 million in American Recovery and Reinvestment Act funding to buy equipment for a new facility for the components in August, according to a document obtained by The Times. The manufacturing plant would be at the AmeriPlex at the Port business park.
Officials and representatives from Fronius declined comment on the document Wednesday.
The Indiana Economic Development Corp. said in a Wednesday media advisory that a company would be relocating its headquarters from a neighboring state and creating hundreds of jobs locally.
Representatives from the Indiana Economic Development Corp., the city of Portage and Holladay Properties, which is the AmeriPlex business park developer, declined further comment Wednesday.
City officials in Brighton, Mich., where Fronius opened its first U.S. sales and service office in 2002, could not be reached for comment Wednesday.
The product Fronius is expected to make in Portage is a component in solar power systems that converts sunlight into electricity. The electricity can then be used to power homes and businesses or fed to the utility transmission grid. The inverter also monitors conditions within the transmission grid.
MJ Shiao, a solar industry analyst with Boston-based GTM Research, said Fronius inverters are sold to wholesale distributors or installers for solar-powered electricity generation systems. He said the company's current strategy is geared toward shipping and supporting the products it makes instead of building finished photovoltaic systems.
Shiao said it would make sense for Fronius to invest in a new U.S. facility because the company and other inverter manufacturing heavyweights are interested in moving production closer to where there is growth in demand.
He said also factoring in the push toward North America and emerging markets are threats from European countries to reduce government incentives for companies and costs falling for producing solar components and installing solar power systems.
"The U.S. is going to become a major market," Shiao said. "It is now much smaller than the European market, but that will certainly change in the next five to 10 years. ... It should be very promising for companies that invest in the U.S. and create jobs in the U.S."
Wels, Austria-based Fronius started in 1945 and still operates its battery charging system manufacturing and welding technology divisions.
Upon entering the U.S. market, Fronius located in the Detroit area to focus on the local automobile industry as its initial target market, according to its website. The company opened a sales and service office in Chattanooga, Tenn., last year.
Earlier this year, Fronius started inverter production at a Canadian facility in Mississauga, Ontario.
Shiao said Fronius is one of the four largest inverter manufacturers in the world that combined have about 60 percent of the global market share.
According to its website, the company increased its sales to approximately $716.6 million last year, up 52 percent from a year earlier. Fronius has installed more than 350,000 inverters worldwide and opened new offices in seven countries last year.
Munster's Lake Business Center at 9200 Calumet Ave. also was in the running for the new Fronius facility and town officials negotiated with company principals starting late last year.
The $9.5 million in stimulus money from the state already was on the table at the time, said Tom DeGiulio, Munster town manager.
"We had a deal with the state. They were willing to pay that money wherever the company went in Northwest Indiana," he said. "When we met with people from Fronius, they were very interested in being nearer to Chicago because two of the principals in the company live in the city."
However, the space in the Lake Business Center needed to be remodeled to accommodate the manufacturing plant.
"The company would have been a key anchor for the Lake Business Center. We felt like we were a second choice. A newer building makes sense for them, so it's not a surprise that they would move to AmeriPlex in Portage," DeGiulio said.
"This was what got the Lake Business Center owners to start really moving on the renovation of that property," he said. "We would have loved to have had the company with those good-paying jobs in Munster. But we're happy they are moving to Northwest Indiana."
Times Statehouse Bureau Chief Dan Carden, staff writer Joyce Russell and correspondent Lu Ann Franklin contributed to this report.