Big Losses for Taxpayers as Another Green Company Turns Rotten

By:  Bob Adelmann
04/17/2012
       
Big Losses for Taxpayers as Another Green Company Turns Rotten

 Beacon Power, the beneficiary of the endless flow of taxpayer guarantees emanating from the Department of Energy, went into bankruptcy in just over two years, leaving lawyers from the Justice Department crying foul.

 
 

Beacon Power, the beneficiary of the endless flow of taxpayer guarantees emanating from the Department of Energy, went into bankruptcy in just over two years, leaving lawyers from the Justice Department crying foul.

 
On the surface the idea of developing flywheel energy storage capacity for utilities that would kick in during peak load periods and then recharge during slack times appeared to have merit. In fact, Beacon Power had invested more than $200 million in the technology since 1997, mostly from banks and private investors. But when Congress passed the American Recovery and Reinvestment Act of 2009 (ARRA), it became a rich source of funding with loan guarantees backed by the U.S. government and Beacon was one of the first to apply for some. In July of that year, Beacon received $43 million in guarantees to help fund construction of a 20 megawatt flywheel energy storage plant in Stephentown, New York.
 
It took just 28 months for Beacon to burn through its government-guaranteed loans and declare bankruptcy. Said Beacon’s CEO William Capp in October of 2011: “The current economic and political climate, the financing terms mandated by DOE [the Department of Energy], and Beacon’s recent delisting notice from Nasdaq [resulting from its share price dropping from $25 a share in late 2007 to under a dollar in 2011] have together severely restricted Beacon’s access to additional investments through the equity markets.”
 
Click here to read the entire article.
The JBS Weekly Member Update offers activism tips, new educational tools, upcoming events, and JBS perspective. Every Monday this e-newsletter will keep you informed on current action projects and offer insight into news events you won't hear from the mainstream media.
JBS Facebook JBS Twitter JBS YouTube JBS RSS Feed