Within a Treasury Department audit report released on April 3, we learn – not surprisingly – the review process for government-backed Solyndra loan was rushed thanks to Department of Energy pressure, and the fact the review process itself was undefined.
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.
Remember in early 2010 when President Obama ordered that all construction on the proposed nuclear waste site at Yucca Mountain be halted? Since then we have heard little about the topic. However, on July 29, the Blue Ribbon Commission on America’s Nuclear Future, formed by President Obama last year, issued its draft report, and it is not good news. Read more
Remember in February, when President Obama decided to cease any further work on the construction of America’s only long term nuclear waste site at Yucca Mountain? The President’s decision caused Secretary of Energy Steven Chu to withdraw the application to have the facility licensed. As it turns out, that may not be happening after all.
Yesterday, a three judge panel of the Nuclear Regulatory Commission’s Atomic Safety and Licensing Board ruled that the Secretary’s actions were illegal because a 1982 law passed by Congress required the Department of Energy to move forward with the Yucca Mountain project.
The law “does not give the secretary the discretion to substitute his policy for the one established by Congress,” the panel ruled.
Undaunted, a spokesperson for the Department of Energy has said that the Department,
remains confident that we have the legal authority to withdraw the application for the Yucca Mountain repository…we believe the administrative board’s decision is wrong…
The panel’s ruling, however, does seem to make perfect sense. The executive branch of the government can’t ignore laws passed by Congress simply because it doesn’t like them.
Then again… see Arizona.