Cooper Roller Bearings (UK; website; 5251R9N7) has received a grant from the UK's Department of Energy and Climate change for £256,250 (USD $400,000).

The grant was one of a group of grants totaling £5 million, awarded to incentivize, identify, and encourage potential UK-based vendors of wind turbines, mechanical components and systems.

Totaled, the grants hit £10 million, but Siemens Windpower received £5 million of that on its own, a grant which had been in the pipeline since the last round. Siemens will use the funds to help it develop an integrated 6 megawatt offshore turbine and foundation in the UK.

The grants, along with those announced by the U.S. government and many other governments around the world, are just the latest manifestation of an escalating government-subsidized arms race -- except that, instead of military infrastructure, the goal is to promote wind energy and the various industries and components needed to build wind turbines domestically.

Cooper Roller Bearings will use its £256,250 to, "develop and demonstrate the use of split bearing technology in large scale wind applications." Cooper is the world's largest manufacturer of split mounted roller bearings.

Ironically for the UK's investment strategy, Cooper is a division of Kaydon Corp., a U.S. company. Kaydon recently received a $1.8 million tax credit from the U.S. government for its Milwaukee, Wisconsin bearing manufacturing facility -- to produce wind turbine bearings.

article: Kaydon receives $1.8 million incentive for wind turbine bearings
Kaydon's U.S. credit is part of the Recovery Act Advanced Energy Manufacturing Tax Credits pool, which totaled $2.3 billion; approximately 180 projects have received awards under the program, all worth up to 30% of a project's value. The tax credit package is intended to incentivize U.S. manufacturers into producing "clean" energy related products such as wind turbines and components.

Kaydon is not alone in receiving grants and incentives; virtually every large bearing manufacturer has received grants and incentives from various governments -- the U.S. government has been particularly aggressive -- trying to encourage wind power in one way or another. However, Kaydon appears to be the first to receive incentives from both UK and the U.S. programs.

A number of recent high-profile media and research reports have begun to question the long-term viability of high-cost wind power generation, absent continuing massive government incentives. Despite government subsidies programs encouraging wind power generation, the recession has seen turbine manufacturers and wind farms face more difficult times than expected, particularly those needing external financing and project approval.

Only a few weeks ago, Kaydon shares were hit when it reported first quarter wind energy bearing sales were below expectations, while "more meaningful" second half 2010 orders are anticipated as the sector improves and customers work off inventory.