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  (Source: benzinga.com)
Beacon Power received a nearly $43 million loan guarantee from the government in August 2010

The Solyndra failure has put alternative energy loans in a negative light as of late, and now the financial failure of yet another renewable energy company is here to add insult to injury. Beacon Power has claimed bankruptcy after receiving government loans as well.

Beacon Power, which creates flywheels to store power and increase grid efficiency by preventing blackouts, filed for bankruptcy protection on Sunday. The company received a nearly $43 million loan guarantee from the Department of Energy in August 2010.

More specifically, Beacon Power owes the Department of Energy $39.1 million and the state of Massachusetts $3.45 million. It received these loans because its technology was seen as aiding grid reliability.

Rep. Cliff Stearns (R-FL), who is leading the recent Solyndra investigation, was quick to attack the Department of Energy with its decision to give not just one bad alternative energy loan, but now two.

"This latest failure is a sharp reminder that DOE has fallen well short of delivering the stimulus jobs that were promised," said Stearns. "Now taxpayers find themselves millions of more dollars in the hole."

The Department of Energy defended its position with Beacon Power, saying that unlike Solyndra, Beacon Power has an operational facility in Stephentown, New York. Solyndra may have closed down completely the day it claimed bankruptcy, but Beacon Power has long term contracts with the Stephentown facility as well as cash reserves, which can be used to pay the government back.

"Protecting taxpayer dollars remains the top priority for Secretary [Stephen] Chu and the Department, which is why we were careful to include many protections for the taxpayer in the loan guarantee for the Stephentown project," said Damien LaVere, DOE spokesman.

While analysts such as Walter Nasde of Ardour Capital believe Beacon Power's technology was a good idea, CNN reports that the company couldn't survive due to the low rates that the government put in place for utilities. In other words, Beacon Power couldn't charge utilities any more than the rates the government set, and it wasn't enough to keep Beacon Power alive.

The low price of natural gas for generating additional power, its failure to attract investors, and an issue with one of its flywheels in July were also listed as nails in Beacon Power's coffin. In addition, Beacon Power's shares, which were down to $3.44 at the end of February and were recently at below $1 a share, led to a notification from NASDAQ that Beacon would be delisted. The company's shares traded for as much as $47.40 in 2005, but closed Monday at 10.7 cents a share, which gives Beacon Power a market value of $3 million.

"The current economic and political climate, the financing terms mandated by DOE, and Beacon's recent delisting notice from NASDAQ have together severely restricted Beacon's access to additional investments through the equity markets," said Beacon Power CEO William Capp.

Beacon Power's revenues from the Stephentown plant were $525,000 in Q2 2011.

Back in September, Capp described the government's role in supporting the construction of the Stephentown plant, and how it would have been impossible without the loan.

"We absolutely couldn't have done it without support from the government, because no one was willing to do it," said Capp. "The projects are so huge, that's the problem. If you demonstrate an energy technology on a grid scale, that's $100 million."

The Beacon Power bankruptcy echoes Solyndra's recent failure, which is a solar panel manufacturer that received $535 million in loan guarantees back in 2009. Solyndra filed for bankruptcy two months ago, and there is an investigation looking into whether DOE properly assessed the risks before giving the loan and whether the Obama administration was pushing the loan despite risks in order to meet political deadlines.

Sources: CNN, Washington Post, GreenBiz.com



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I'd like some cash too!
By Dr of crap on 11/1/2011 10:20:25 AM , Rating: 5
I have some creditors that want my money.
I and my wife are working in secure jobs.
I'd like some of that money the govt is handing out.
Like a grant or something.
AND I DON'T EVEN NEED A MILLION.
For the small sum of $100,000 I'd do a study with the grant money of how you can live better when you have no bills!




RE: I'd like some cash too!
By retrospooty on 11/1/2011 10:24:09 AM , Rating: 3
Good plan... Your going to have to illustrate how you will financially benefit a few key congressmen in the right committees to get this through though. Campaign donations, a few small "gifts" like a vacation home in Martha's Vinyard, etc etc.


RE: I'd like some cash too!
By supermitsuba on 11/1/2011 10:24:34 AM , Rating: 2
Really! I can help spend money like it's going out of style too! I will even say it's for the green industry.

How about we start by giving these loans to somewhat stable industries or lower risk companies...i dont know, im just a dumb citizen...


RE: I'd like some cash too!
By OneArmedScissorB on 11/1/2011 10:59:02 AM , Rating: 3
How about we start by stopping these loans altogether, so that we don't have to hear about it again? :p

For the next step, then we can start working on ways to completely drop the DOE. They have some important responsibilities, such as dismantling nuclear weapons, but that's not something that will go on forever. Its purpose is otherwise completely convoluted and it's no wonder things like this happen over and over and over.


RE: I'd like some cash too!
By The Raven on 11/1/2011 11:15:58 AM , Rating: 3
At the very least, let's not call this a "guaranteed loan" and just call it "spending". And get rid of such things. A loan is a loan, but this is just spending. You can't even really call it an investment.

But that is just the very least they could do. I'm really against it all especially at the federal level.


RE: I'd like some cash too!
By pburghdoom on 11/2/2011 10:17:11 AM , Rating: 1
I would rather lose this money than not invest in alternative energy. Considering the amount of money/lives we spend/lose on oil, I think this is small change.


RE: I'd like some cash too!
By tigz1218 on 11/1/2011 10:34:04 AM , Rating: 2
I want cash too. So I am saving money to start my own business. I have cut out unnecessary spending, paid for my patents, and now finding the best quote from manufactures. I refuse to have someone else pay for my debt, it was my decisions that got me in it and it has been my ongoing decisions that has got me out of it.

Your whining attitude is precisely why I have lost faith in this country and I believe we won't see a booming society again until government bailouts and entitlement programs are evaporated and people learn that capital isn't created by printing more monopoly dollars, but it is produced by hard work. There are many other things holding us back, but for the purpose of this post I will keep it short.


RE: I'd like some cash too!
By protosv on 11/1/2011 10:43:34 AM , Rating: 2
quote:
Your whining attitude is precisely why I have lost faith in this country and I believe we won't see a booming society again until government bailouts and entitlement programs are evaporated and people learn that capital isn't created by printing more monopoly dollars, but it is produced by hard work. There are many other things holding us back, but for the purpose of this post I will keep it short.


I believe your sarcasm detector is experiencing problems.


RE: I'd like some cash too!
By tigz1218 on 11/1/2011 11:56:30 AM , Rating: 2
I'm currently located in downtown NY near the occupy socialists. My sarcasm detector has been desensitized. Apologize for any hard feelings.


RE: I'd like some cash too!
By FITCamaro on 11/1/2011 12:31:41 PM , Rating: 3
Can you put on a mask and then go kick a few of them in the face for me?


RE: I'd like some cash too!
By Spuke on 11/1/2011 2:19:51 PM , Rating: 2
quote:
Can you put on a mask and then go kick a few of them in the face for me?
Why? Although I think they're really wasting their time, they have a right to protest. I have a question, do ANY conservatives believe in the Constitutional right to protest? (there's that C word again...wait, aren't conservatives for the Constitution?) Everytime there's a protest of any sort, the protesters are automatically deemed a bunch of weirdo, hippy, college students. They did the same with the tea party when they first started protesting until you (the royal you) discovered that they were for "conservative values" then it was ok, sort of.


RE: I'd like some cash too!
By FITCamaro on 11/1/2011 2:59:20 PM , Rating: 2
I'm not saying people don't have the right to protest.

I'm saying they have no point and are nothing but the useful idiots that Marx talks about.

And I was at several Tea Party protests. We were peaceful, we had a point, we delivered the message we wanted to, we cleaned up when we left, and we went back to work. No one got arrested. No one assaulted cops. No one trashed the area they were in.

Hell I was at the 9/12 rally in 2009 and with a few hundred thousand people there, the place was left clean when we left.


RE: I'd like some cash too!
By YashBudini on 11/1/2011 9:11:12 PM , Rating: 2
quote:
the place was left clean when we left

The same condition Wall St left many bank and retirement accounts.

Hardly worth overlooking or down playing.


RE: I'd like some cash too!
By YashBudini on 11/1/2011 9:20:41 PM , Rating: 2
quote:
I'm not saying people don't have the right to protest.


No you said this:

quote:
Everytime there's a protest of any sort, the protesters are automatically deemed a bunch of weirdo, hippy, college students.


Exactly like Spuke stated. Not exactly big on ownership, are we?

Mocking ethical behavior and standards doesn't come as any surprise from a country where a lot of people look up to fake characters like Al Pacino's Scarface and The Soprano's. Apparently real success to many means screwing over anybody and everybody. Ethics are for sissies. Only fools play by the rules. You said it yourself, in school you were taught to win, I recall you never mentioned at what cost.


RE: I'd like some cash too!
By FITCamaro on 11/2/2011 11:27:32 AM , Rating: 1
Where did I say the second thing? That's a quote from Spuke's post. Are you implying that's what I meant? Or that I said that some time long ago?

But many of them are hippy college students who are brainwashed by their professors into believing in crap like Marx. Others are true Marxists and Socialists.

Also where do I say that all people on Wall Street have acted ethically? No where. I fully agree with the statement that some of those on Wall Street got greedy. But a bunch of Marxist/Socialist bums sitting on Wall Street from months doing drugs and yelling isn't going to change that. Electing politicians who don't encourage them to make bad decisions in order to gain support among certain ethnic groups can.

And yes I was taught to win. As everyone should be. But you know what you're also taught (or should be)? Fair play.


RE: I'd like some cash too!
By YashBudini on 11/2/2011 2:33:25 PM , Rating: 3
quote:
But many of them are hippy college students who are brainwashed by their professors into believing in crap like Marx. Others are true Marxists and Socialists.


I've seen right and left wing extremists in schools. Both are whack jobs. To say or imply otherwise is the real brainwashing. Right wing extremists today essentially behave such that if you're not a total misanthrope you're a socialist. And another common phenomenon of the faux crowd is that the opposition can be 100% wrong, totally discredited. There's never been a human argument where that's true, but apparently it's true in US politics today. Must be that fair and balanced stuff we hear about.

quote:
I fully agree with the statement that some of those on Wall Street got greedy.

Lack of full disclose is beyond greed. They broke the law. The SEC slapped them on the wrist while giving them a hummer. If you really believe in fair play you'd address this accordingly, which is what those slobs of protesters are trying to do.

And those in charge that have robbed businesses blind or made a mess on Wall St, they come from non-Marxist business schools, or didn't you notice? Oh I keep forgetting the extremist pendulum only swings 1 way, yeah right.

You may want to address fair play with your congressman. They are exempt from insider trading laws regardless what party they are in.


RE: I'd like some cash too!
By Dug on 11/2/2011 2:33:15 PM , Rating: 2
But apparently applying for a job and not getting it, is hard work. At least according to the protesters.

They want to be handed jobs and let someone else think for them.

I wish the people that were actually doing something in this world had enough time to protest the protesters and give them the same message you just did.

It's a free country people. If you don't like what you see then do something about it. You will always be a looser if you say you can't do something about it.


RE: I'd like some cash too!
By sthayashi on 11/1/2011 10:45:15 AM , Rating: 2
Start a business that'll create jobs and I'm sure the gov't will be willing to talk to you.


RE: I'd like some cash too!
By YashBudini on 11/1/2011 9:12:30 PM , Rating: 2
They only talk to lobbyists.


RE: I'd like some cash too!
By senecarr on 11/1/2011 11:48:48 AM , Rating: 2
Unfortunately, Congress, their aids, and the groups lobbying them are already performing this study.


RE: I'd like some cash too!
By DanD85 on 11/2/2011 6:44:35 AM , Rating: 2
I like your plan too, but sorry, with this current administration, although Obama got the position for his "Change" mantra but how come "change" can happen when he handpicked all of the bastards who engineered the economic meltdown of 2008 and give them even more power! Woah, no wonder they keep running our great country to the ground.

Don't believe me? Please watch Inside Job (http://www.imdb.com/title/tt1645089/) to see how it happen. I think some will even want to join the Occupy Wall Street movement after watching this movie.

For those who ask "What can we do?", please have a look at Bad Samaritans (http://www.amazon.com/Bad-Samaritans-Secret-Histor... to get some answer.


Just give me back my tax money
By Beenthere on 11/1/2011 10:49:13 AM , Rating: 2
This ain't Bama's money they are pissing away nor the DOE's money, it's my tax money. Just give me back my tax money and stop giving out bad loans. I'm sure these companies filing bankruptcy will still find enough money to make significant financial political contributions to the criminals on Corruption Hill.




RE: Just give me back my tax money
By Shig on 11/1/11, Rating: 0
By Beenthere on 11/1/2011 11:42:02 AM , Rating: 1
If you want to allow the Gov. to piss away your money that's fine with me, but they don't have my permission to piss away my tax dollars. I fully agree that the banks, oil industry and many other entities are criminal and should not receive our tax dollars, tax breaks, etc. but that does not make the $550 million pissed away on two bad loads acceptable to me. Just give me back my tax money and the Gov. can do whatever they chose with YOUR money. <LOL>


RE: Just give me back my tax money
By FITCamaro on 11/1/2011 12:37:01 PM , Rating: 2
You have new fees on your checking account because of the Dodd-Frank financial reform bill that, amongst other things, limited how much banks can charge retailers per transactions for debit cards.

You have no one to blame but them. And the banks warned of it happening. Of course now Chris Dodd is yelling at Bank of America for doing exactly what it said would happen.


RE: Just give me back my tax money
By FITCamaro on 11/1/2011 12:40:03 PM , Rating: 1
And I use the words "financial reform" very loosely. That bill did nothing but screw over consumers. Especially responsible ones.

Just wait until credit card interest rates skyrocket in 2013 due to parts of that bill.


RE: Just give me back my tax money
By YashBudini on 11/1/2011 9:29:15 PM , Rating: 1
If you're doing business with a major bank you should expect to get screwed. They change the rules on a regular basis. The fee-du-jour is what I call it.

Still bank with them? It's your own damn fault.


RE: Just give me back my tax money
By JediJeb on 11/2/2011 9:53:00 AM , Rating: 2
That is why I only use a small local bank. They still charge no fees even if you use another banks Debit card in their ATM. You will however be charged that banks fee if you use it there.


By YashBudini on 11/2/2011 10:48:54 AM , Rating: 2
My ex-bank started charging me $20 a year for their free ATM card. I closed my account. The bank manager tried to keep me there but failed. I said, "You seem frustrated, welcome to my world."

I never make debit card purchases.


By Dr of crap on 11/1/2011 12:39:38 PM , Rating: 1
Yeah I like my tax money being GIVEN to companies that don't have a solid footing and then the money is lost.
GREAT plan.

If I got money like that - I'd be able to pay it back with interest ( small interest it would be, but interest).
I'm a WAY better risk than these companies the govt chooses!


ENOUGH!
By zolarkingofallmoney on 11/1/2011 10:46:28 AM , Rating: 2
This is pennies that the Govt. put up for an amazing technology return. Watch Becon's assets be scooped up by some smart Chinese firm and we'll be buying our own tech back from them in ten years time. US has never been too bright when it comes to long term investments. Look, there are only a few ways to store electricity. These guys have a pretty good solution. Hopefully Intel or Microsoft or Apple will buy them and keep it here. They actually built a plant that WORKS! It was cheap (non-renewable) gas prices and govt. deciding what they could charge that did them in. Without the Govt. investment we would not have ever reached the Moon or created the B-1 bomber. These large scale public utility plays are the only way to avoid smog filled air, acid rain and nuclear waste nightmare issues over the next twenty years. All you Govt. spending haters should realize that this company was trying to HELP the average Joe by removing the spot market scarcity plays that speculators used in California to bleed the state dry. Not all Govt. spending is bad. Especially when it works!




RE: ENOUGH!
By OneArmedScissorB on 11/1/2011 10:53:55 AM , Rating: 2
quote:
Not all Govt. spending is bad. Especially when it works!


Citation needed.

Your argument was essentially to allow the government to waste money and manipulate people because a free market business had a good idea, even though you stated that government intervention was also the problem.

So which is it?


RE: ENOUGH!
By Beenthere on 11/1/2011 11:23:18 AM , Rating: 2
Those $$$$ are MY $$$$ and the gov has no right to irresponsibly grant loans to anyone. If this tech is so great then this company should have had no problems raising capital to fund development. Unfortunately most government is just as corrupt as the companies it hands money and contracts too...


RE: ENOUGH!
By YashBudini on 11/1/2011 9:33:13 PM , Rating: 2
The US spent a lot of years writing blank checks while playing the F card (fear). Now they're playing the G card (green).

As originally stated, 2 parties, just 2 sides of the same coin. If you think you're party is better then all you've done is to con yourself.


Color me shocked!
By FITCamaro on 11/1/2011 12:01:19 PM , Rating: 3
quote:
"Protecting taxpayer dollars remains the top priority for Secretary [Stephen] Chu and the Department, which is why we were careful to include many protections for the taxpayer in the loan guarantee for the Stephentown project," said Damien LaVere, DOE spokesman.


Ok so with $43 million you thought to include "protections" but with over $500 million it wasn't important? We already know they refinanced the loan to give shareholders priority over taxpayers, so I guess Beacon's owners just didn't know powerful enough people.

quote:
While analysts such as Walter Nasde of Ardour Capital believe Beacon Power's technology was a good idea, CNN reports that the company couldn't survive due to the low rates that the government put in place for utilities. In other words, Beacon Power couldn't charge utilities any more than the rates the government set, and it wasn't enough to keep Beacon Power alive.


So while the government was more than willing to loan them the money, on the other hand they helped ensure their downfall. I'm not saying this was done to them exclusively, just pointing out the stupidity of all the federal governments regulations. They push or promote a technology that can't stay afloat under the government's own rules.

quote:
Back in September, Capp described the government's role in supporting the construction of the Stephentown plant, and how it would have been impossible without the loan.


And clearly it should have stayed impossible. No one thought to look at what the max they could charge was and see if that would allow the business to make money or even break even? Where was that in their business plan? Was it written on a napkin?




RE: Color me shocked!
By kattanna on 11/1/2011 12:22:32 PM , Rating: 2
yeah loaning money out while at the same time limiting revenue to repay seems really silly, but i am wondering if it wasnt simply a case of the left hand not knowing what the right hand is doing, government wise.

if the government wanted to mandate something, they should require all wind farms to utilize these power systems to help with distribution issues, the wild swing in availability, throughout the day. something that is a pain, grid wise, to deal with.


Where does the tech go?
By nafhan on 11/1/2011 12:43:10 PM , Rating: 2
So, I'm assuming Beacon (and Solyandra) both had some interesting technology portfolios. Does that now become taxpayer property or does it get auctioned off to some private company for next to nothing? Probably a private company owned by a friend of a congressman or representative...

A government owned patent pool that they license to American companies, might be a good way to recoup some of that investment in the long run.




“So far we have not seen a single Android device that does not infringe on our patents." -- Microsoft General Counsel Brad Smith














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