Beacon Power, a Massachusetts-based, clean-energy company, filed for bankruptcy protection on Sunday, Reuters reported, potentially leaving taxpayers on the hook for up to $43 million, reports Business Insider.
So what's the reason this time?
“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,” Chief Executive Officer F. William Capp said in papers filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware, according to a recent Bloomberg report.
In short, the "political environment" and financing terms that the company agreed to are prohibiting them from operating profitably?
Early chatter is that this case may very well be another Solyndra situation all over again. Much like the failed energy company, Beacon Power received millions ($43 million to be exact) in loan guarantees only to file for bankruptcy soon afterwards.
This could make matters worse for the Obama administration seeing as how House Republicans have already started an investigation into the DOE loan program. Another bankruptcy will only exacerbate the situation.
However, unlike Solyndra, taxpayers will be "among the first in line to collect among Beacon's creditors." Yet despite this, the failure of yet another energy company only adds to the list of failed investments made by the administration--and thus strengthens the argument against the administration's long-term "clean energy" goals.
Beacon Power assures investors that not all is lost.
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,” according to Bloomberg.