Punch line: A big chunk of the Stimulus money was thrown at the development of green energy technology. Unfortunately, the recipients have proven to be non-competitive.
Excerpted from SFGate.com: Solyndra closes Fremont plant – stimulus hopes dim
Solyndra received $535 million of stimulus money in 2009 to build a solar panel plant.
This week, Solyndra announced that it will close its last remaining factory, lay off its 1,100 employees and file for bankruptcy.
The bankruptcy also represents a high-profile failure for a federal stimulus program that gives loan guarantees to green-tech manufacturers.
Solyndra, whose solar modules are thin tubes rather than flat panels, struggled to compete against a flood of low-priced solar cells pouring out of China.
Solar module prices have plunged more than 40 percent in recent years, squeezing companies’ profit margins even as sales of solar systems grow. Two other U.S. solar companies, Evergreen Solar and SpectraWatt, filed for bankruptcy protection in August.
The administration’s response: “We have always recognized that not every one of the innovative companies supported by our loans and loan guarantees would succeed, but we can’t stop investing in game-changing technologies that are key to America’s leadership in the global economy,”
Full article: Solyndra closes Fremont plant – stimulus hopes dim
Ken’s Take: I’m all for green energy alternatives, but I certainly don’t think that the Feds should be in the venture capital business.
There’s a reason that these companies couldn’t raise private capital: they’re not competitive in the world market.
Think about it: Would you put your company’s manufacturing plant in China or California?
The Homa Files 