NESTLED in the green hills of southern Germany, chemical giant Wacker Chemie churns out a wide range of products, from an ingredient for chewing gum to the polysilicon crystals in solar cells.

    The electricity to produce all that — enough power for more than 700,000 households annually — has become more costly at Wacker’s main factory in Burghausen. It has played a big part in pushing up the firm’s total energy bill by 70 percent over the last five years, to nearly half a billion euros.

    It’s a different story across the Atlantic in the U.S. state of Louisiana. There, chemicals maker Huntsman Corp. pays 22 percent less for its power than it did just seven years ago.

    The tale of those numbers underlines a profound shift underway in two of the world’s biggest industrial powers.

    Thanks in large part to Germany’s decision to phase out nuclear power and push into green energy, companies there now pay some of the highest prices in the world for power. On average, German industrial companies with large power appetites paid about 0.15 euros (US$0.21) per kilowatt hour (kWh) of electricity last year, according to Eurostat, the European Union’s statistics agency.

    In the United States, electricity prices are falling thanks to natural gas derived from fracking — the hydraulic fracturing of rock. Louisiana now boasts industrial electricity prices of just US$0.055 per kWh, according to U.S. Energy Information Administration data.

    Peter Huntsman, chief executive of the family firm, calls the United States the new global standard for low-cost manufacturing. Huntsman is spending hundreds of millions of dollars to expand in the United States, and rapidly closing plants in Europe. The company estimates that a large, modern petrochemical plant in the United States is US$125 million cheaper to run per year than in Europe. That sum includes cheaper power, waste disposal and myriad other factors, and Huntsman said the contrast is similar for Asian plants.

    “It’s not a question of whether other countries are competitive or not,” Huntsman, brother of former U.S. presidential candidate Jon, said in an interview. “They’re not.”

    Power isn’t the only reason the United States is becoming so attractive to manufacturers again. Average labor costs in China have more than doubled since 2007 to around US$2 per hour, while they’ve risen less in the United States to around US$18 per hour, with worker productivity far higher in the United States, according to U.S. government statistics. When you factor in the cost of shipping goods from Asia, it’s little wonder that America has re-emerged as one of the most competitive places to build stuff.

    That’s a dramatic change from just a few years ago, when Germany was held up as a model of manufacturing prowess. As recently as 2011, politicians in Washington were openly discussing how to copy Germany’s success.

    Now things are heading the other way. In March, BMW, the world’s largest luxury carmaker, said it would invest US$1 billion to expand its plant in Spartanburg, South Carolina, making it the German group’s biggest production facility by 2016. In all, German companies invested more than 800 billion euros in U.S. expansions between 2008 and 2012, according to the most recent Bundesbank statistics. Germany’s Chamber of Commerce and Industry reckons that investments could reach 200 billion euros in 2014, an all-time high.(SD-Agencies)