#Greenfail: Obama’s Solar and Battery Initiatives File for Bankruptcy In Same Week.
10/18/2012 3 Comments
It has been a bad week for the Obama Green Jobs Initiative as two more companies with Federal Loans file for bankruptcy. In the A123 case there is clear evidence of how crony capitalism works. The government picks the winner and looser, and so far the Obama administration has picked more losers than winners.
Here are some details:
Troubled battery maker [A123] won private meeting and phone call with Obama, a trade mission slot and $250 million in stimulus money before it went bankrupt
Executives of an energy company that received $250 million in federal money made donations to members of Congress while the company was facing bankruptcy.
Even as advanced battery maker A123 Systems struggled for financial viability, it played the Washington insider game, where political money and access go hand in hand.
The Massachusetts firm dished out nearly $1 million to hire a powerhouse lobbying firm with close ties to President Barack Obama between 2007 and 2009, and two of its top executives made personal donations to several high-profile Democrats in Congress as it won federal funding for its efforts to build the next generation of lithium batteries for electric vehicles.
The company produced and sold zero batteries More details HERE.
But there is more:
A solar company that got a multi-million-dollar grant from the Department of Energy earlier this year announced Wednesday that it will file for Chapter 11 bankruptcy protection, making it the second taxpayer-backed green energy company to file for bankruptcy this week.
Satcon Technology Corp. announced the decision in a Wednesday news release. “This has been a difficult time for Satcon,” president and CEO Steve Rhoades said. “After careful consideration of available alternatives, the Company’s Board of Directors determined that the Chapter 11 filings were a necessary and prudent step, allowing the Company to continue to operate while giving us the opportunity to reorganize with a stronger balance sheet and capital structure.”
Satcon received a $3 million DOE grant in January to develop “a compact, lightweight power conversion device that is capable of taking utility-scale solar power and outputting it directly into the electric utility grid at distribution voltage levels—eliminating the need for large transformers.”
More details HERE.
When there is no market for your product, there is no hope of success. All the government grants in the world cannot create sustainable markets. Government mandates can create the illusion of potential markets but they vanish when the subsides run out.