Preface: “Our national debt, at $15.8 [trillion], would form a stack of $100 bills 10,712 miles high.” (Source). Embedded waste is now a governmental norm.
I want this statement to be true, I just don't believe it:
(Source). Still, the article later says: " Unfortunately, in the first 18 months after the stimulus bill, only 1 percent of the funds were deployed and more than 80 percent of that went to two companies that are now bankrupt." Yet, it's got this hopeful passage:
As more fully presented here, a very bright fellow delves into the corrupting effects of subsidization, in response to this pro-subsidization article:
But the bottom line remains the same with all spending of Other Peoples Money (OPM) by government officials. From George Will's 10/2/12 column about Tesla Motors:
Collected here are Solar projects (PV and Thermal-based) approved by Pol-Crats (Politicians and their Bureaucrats) which I believe are likely to fail. By "fail," I mean never be able to compete on the free market without express if not also hidden subsidies, and probably will just go belly up like Solyndra:
An April, 2013 sum-up of "the solar debacle" may be found here. "More are expected to fail." (Source).
An April 2012 sum-up of "the solar debacle" may be found here.
Abengoa Solar This project's receiving direct hand-outs and indirect subsidies (tax credits translated into "tax equity" for third-party investors). (Source).
Other boondoggles in the making: 9/30/11: $ 1 Billion for Sempra and Solar Reserve
These "Concentrating Solar Power" projects closed DOE loan guarantees in Q3-2011:
• 250 MW Mojave Solar trough CSP project
• 110 MW Crescent Dunes tower CSP project
• 250 MW Genesis trough CSP project
• 30 MW Alamosa CPV project
(Source). For these projects I see three possibilities: (1) they'll commercially succeed and never need to feed at the public trough and thus socialize their risk; (2) they'll not succeed commercially but be kept "alive," zombie-company style, for appearances sake; or (3) they'll fail outright like Solyndra.
Q-Cells (Germany). This Solar PV maker lost $400 million over the last quarter of 2011 alone. See Photon (Dec. 2011) at 19. I'd like to know how much of that involved taxpayer money (directly, via production-side subsidies, or indirectly, via demand-side subsidies). Why did it tank? Consider this: "In the beginning, Germans paid a “feed-in tariff” of 65 cents per kilowatt-hour for power from the roof; the total comparable cost for power from a new gas plant in the United States is about 6 cents. Solar panels sprouted everywhere. Q-Cells Corp. became the world’s largest producer. Investors piled on. Q-Cells rose from $30 a share in October 2006 to a peak of $97.60 in 13 months. Today it is trading at 55 cents." (Source). Catch that? Germany's government super-subsidized Solar PV (via feed-in-tariffs) and thus juiced up demand. Q-Cells ramped up production and fed at the trough. Then what happened? "Germany gradually reduced the tariff by about 50 percent, which substantially lengthened the time in which a panel will pay for itself. A huge supply of solar panels glutted the market, and the carnage is industrywide. A person who invested $2,500 in the Guggenheim Solar Energy Fund in 2008 (symbol: TAN) would have $267 today, typical for this sector." (Source).
Still, Q-Cells is pushing up solar panel efficiency, now claiming 18.5% with a "confirmed a peak output of 283 W for a quasi-monocrystalline solar PV module." (Source). April, 2012 update: Q-Cells is now bankrupt.
SoloPower, which in 2011 received a U.S. DOE loan for $197 million to produce copper, indium, gallium and selenium (CIGS) on glass Solar PV (basically, Solyndra's technology). (Source).
First Solar is having subsidy-related solar plant sale problems: "First Solar Inc.'s shares fell sharply Friday after the company warned a delay in government funding may stymie its sale of a California solar farm." (Source) Here's an outrageous story about First Solar ("Firm sells solar panels - to itself, taxpayers pay").
A123 Battery company ("An electric car battery company reportedly has laid off 125 employees since receiving $390 million in government subsidies, but is still handing out big pay raises to company executives. A123 systems, which was touted as a stimulus "success story" by former Gov. Jennifer Granholm, D-Mich., had a net loss of $172 million through the first three quarters of 2011, according to the Washington Examiner's "Beltway Confidential" blog, citing a report from the Michigan-based Mackinac Center for Public Policy. 123's primary customer, Fisker Automotive, is also struggling financially. "Yet, this month A123’s Compensation Committee approved a $30,000 raise for [Chief Financial Officer David] Prystash just days after Fisker Automotive announced the U.S. Energy Department had cut off what was left of its $528.7 million loan it had previously received.”). Read more about 123 here. October 16, 2012 update: A123's own forecast -- doom. October 16, 2012: It's bankrupt! Here's a post-mortem. It's money quote: "I think there's a strong argument that the government's assistance to A123 was actually a key factor in leading them to bankruptcy, by prompting A123 to grow much faster than could have been justified to its bankers or private investors."
But read this article insisting A123 is only in Chapter 11 bankruptcy, so it's not dead yet. December 10, 2012: No, it's dead, and parts of its carcass has been sold off to the Chinese.
Boondoggle news in "Battery" sector: Ener-1 files for bankruptcy.
A123 may be circling the drain. Money Quote:
(Source). October 16, 2012 update: A123's own forecast -- doom. Later that day: It's bankrupt! But read this article insisting it's only Chapter 11 bankruptcy, so A123 is not dead yet.
And now LG Chem, the Chevy Volt battery maker, is revealed as just another boondoggle.
October, 2013: Ecotality Cratered
Brightsource: "The recipient of the Obama administration's biggest loan guarantee for solar energy won federal money after an intense push in early 2011 that included hiring a former chief of staff to Vice President Joe Biden to lobby the administration, according to federal records and people involved in the approval process. The lobbying blitz came as the $1.6 billion loan to BrightSource Energy Inc.—a centerpiece of the administration's program to promote nascent green-energy projects—faced a do-or-die moment, and the company called on its Democratic connections to help push the deal forward, according to emails, records and those familiar with the loan."
The entire electric car sector ("Yet the state of the electric car is dismal, the victim of hyped expectations, technological flops, high costs and a hostile political climate. General Motors has temporarily suspended production of the plug-in electric Chevy Volt because of low sales. Nissan’s all-electric Leaf is struggling in the market. A number of start-up electric vehicle and battery companies have folded. And the federal government has slowed its multibillion-dollar program of support for advanced technology vehicles in the face of market setbacks and heavy political criticism."). Add Fisker to this "Atlas Motors" section, too: "Fisker, an electric-car maker, is currently not making any cars due to various design and production problems. Last year the Department of Energy stopped lending money to Fisker after the company missed development deadlines, but federal taxpayers were already on the hook for more than $190 million. Fisker's problems have lately been exacerbated by the October bankruptcy of a key supplier, A123 Systems, AONEQ -4.76% which also received federal loans." (Source).
Confirmed Boondoggles (Corporate Solar Welfare Queens Who Copped Our Money and Went Bust)
ABC News: "A month before Abound Solar announced it would be laying off nearly half its workforce, Congressional Republicans alerted the U.S. Department of Energy that they had questions about the decision to loan the Colorado firm $400 million." Here's a Solar Fanboy group's attempt to rationalize away this outrageous squandering of our tax dollars (it superilluminates the fact that W and fellow Republicans backed it, so....). Here's another article on its straight-up Chapter 7 (that's liquidation, not reorganization) bankruptcy. And now a criminal investigation into Abound Solar. Click here, too.
Solyndra (full ABC news investigation); see also this
Certainly, another three solar manufacturers that received backing from the Obama administration believe they will survive the onslaught of cheap Chinese panels. Loveland, Colorado-based Abound Solar and SoloPower won a total of $597 million in loan guarantees from the US Department of Energy (DoE) to begin building their first commercial solar panel plants this year, while 1366 Technologies has received a $150 million guarantee for a polysilicon wafer factory. 1366, based in Lexington, Massachusetts, is a product of the DoE's Advanced Research Projects Agency-Energy, or ARPA-E, which makes grants to entities with innovative ideas that have strong commercial applicability. Whereas Solyndra tried to sell a markedly different product from its Chinese competitors, 1366 offers a commodity product made in a different way with lower production costs. 1366 says it is able to cast its wafers from molten silicon, rather than the conventional method of slicing the wafers from a large ingot, which tends to result in a lot of wastage.
Companies not favoured with DoE funding have fared a lot less well. In August 2011, Massachusetts-based Evergreen Solar was forced to file for bankruptcy, blaming overcapacity in the sector due to falling subsidies and growing competition from government-subsidised solar panel makers in China. Evergreen plans to close its plant in Midland, Michigan, at the cost of around 65 jobs but its factory in Wuhan, China, built with a $33 million investment by the local government, will remain open, at least for now.
Look at how sloppy the Canadian bureaucrats were once they turned on the free-money spigot for Solar Welfare Queens: "Billions of dollars of new solar and wind power projects were approved without many of the usual planning, regulatory and oversight processes, notes Jim McCarter, office of the auditor general for Ontario, in a 2011 annual report." (Source).
Konarka: "In total, Konarka attracted $20 million in government research grants as well as $170 million in private investment money. The company filed Chapter 7 bankruptcy in Massachusetts on June 1st, citing inability to obtain needed financing as the reason why it would no longer be able to continue operations. Eighty-five Konarka employees will be laid off; the bankruptcy filing shows the company listed between $100,000 and $500,000 in assets and $10 to $50 million in debt." More here.
More on Solar Corporate Welfare Queens (and potential boondoggles in the making):
Abound Solar ($400 million of our money) -- no, make that $597 million in loan guarantees. Here's a fun read on it, noting: "And one of the solar panel manufacturer's major investors, Pat Stryker, bundled over $87,000 for Obama’s 2008 presidential campaign."Here's the bottom line on Abound Solar (price rules): "Much of Abound’s ability to survive in the solar market will depend on the company’s ability to reduce production costs below $1 per watt. (Source).
Here's a November, 2011 article on that company.
BP Solar, after four decades in the business, basically bit the dust at the end of 2011. Money Quote: "BP’s exit from the solar industry after some four decades shows how competitive and crowded the solar market has become. The company said it could no longer make money from solar given the inventory buildup and plummeting prices that have characterized the solar market this year." My Question: Did it take a bunch of public dollars with it?
Battery maker Ener-1 files for bankruptcy: "The company, Ener1, received a $118 million grant from DOE in 2010 as part of the president’s stimulus package. The money, which went to Ener1 subsidiary EnerDel, aimed to promote renewable energy storage battery technology for electrical grid use."
From that same source: "Ener1 is not the first energy storage technology company to file for Chapter 11 after receiving significant stimulus support. Beacon Power, which manufactures flywheel energy storage technology, received a $43 million loan guarantee from the same stimulus program that funded Solyndra. Despite having used $3 million marked for loan repayment to continue funding its daily operations, Beacon filed for Chapter 11 in November."Amonix Inc. teeters to the edge: "Just seven months after California-based solar power company Amonix Inc. opened its largest manufacturing plant, in North Las Vegas, the company’s contractor has laid off nearly two-thirds of its workforce."
SolarHybrid -- Died once Germany's Feed-In-Tariff rate (another subsidy, to the extent it pays solar producers way above wholesale prices, paid for by ratepayers) was cut.
Note the common theme to boondoggles: shifting economic and thus moral hazard to the taxpayers. Free money, invest and spend it with abandon. Very predictable, and led to the biggest bust in modern history -- in the residential lending sector (more on that here).
Solar's not the only boondoggle bullseye, by the way. Check out my Biomass Boondoggle page here.
Sovello, following Q-Cells into the bankruptcy ditch.
Nuclear Boondoggles: California $1 Billion