Remember Solyndra? This weekend, Beacon Power Corporation of Tyngsboro, Massachusetts filed for bankruptcy protection. In August, 2010, the Obama administration, through the Department of Energy, gave it a $43 million loan guarantee to build a plant in Stephentown, New York that opened in January, 2011.
Here is what Beacon Power does. It makes,
[f]ast-spinning flywheels [that] can absorb and dispatch quick bursts of power onto the [electric power] grid to maintain a balance between supply and demand.
The Department of Energy doesn’t seem worried though.
Beacon’s U.S. loan agreement includes’“many protections for the taxpayer,’ said Damien LaVera, an Energy Department spokesman.
‘This [Stephentown, N.Y.] plant itself, which is operational and generating revenue, is a valuable collateral asset,’ LaVera said in an e-mail yesterday. The Beacon Power subsidiary that received the loan guarantee ‘has cash reserves and proceeds from the plant that it was required to hold as collateral on the loan.’
Super. Let’s let the government run the Stephentown plant. If my memory serves me correctly, the government couldn’t even run a brothel in Nevada. Good luck with this project.
But, this is somewhat interesting. The bankruptcy petition lists $72 million in assets and $47 million in liabilities. Asset valuation, much like beauty, can tend to be in the eyes of the beholder, but liabilities are cast in concrete. Of the $47 million in liabilities, $39.1 million (some 83%) is currently owed to you, the taxpayer.
Personally, I believe the government shouldn’t be “investing” in private companies. So far their track record doesn’t seem to be stellar. Thankfully, the federal government doesn’t make my IRA investment decisions…yet.
We’ll keep you posted.
In 2009 Beacon Power was also given a $24 million “Smart Grid stimulus grant” to build a plant outside Wilkes-Barre, Pennsylvania. I do not know whether it ever received this money, but, I do know that the plant was never built.