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Beacon Power Files Bankruptcy After DOE Loan

From Bloomberg:

Beacon Power, Backed by U.S. Guarantee, Files Bankruptcy

By Dawn McCarty
October 31, 2011

Oct. 31 (Bloomberg) — Beacon Power Corp., an energy- storage company that received $43 million in backing from the U.S. program that supported failed solar-panel maker Solyndra LLC, filed for bankruptcy after struggling to raise private financing.

The money-losing company, which makes flywheels that manage energy moving through a power grid, had sought to avoid the fate of Solyndra, which entered bankruptcy last month after receiving a $535 million loan guarantee from a U.S. Energy Department program designed to spur alternative energy development. Beacon faced delisting of its shares by the Nasdaq Stock Market and warned in an Aug. 9 regulatory filing that it might not remain a “going concern.”

“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.

Beacon, based in Tyngsboro, Massachusetts, listed assets of $72 million and debt of $47 million in its Chapter 11 petition. Two affiliates also entered court protection.

Beacon’s first grid-scale plant, with 200 flywheels, began operating in January. The 20-megawatt facility in Stephentown, New York, was funded using the $43 million Energy Department loan guarantee issued in August 2010. About $39.1 million is currently due under the loan, Capp said.

In addition, Beacon received $29 million in grants from the U.S. and Pennsylvania for a 20-megawatt plant in that state and hired Group Robinson LLC to help raise more funds for the $53 million project

The bankruptcy filing came 10 days after the Federal Energy Regulatory Commission approved a rule providing incentive payments to companies such as Beacon. The payments may double Beacon’s revenue and make it easier to arrange financing, Walter Nasdeo, director of research at Ardour Capital in New York, said in an interview at the time.

Gene Hunt, a Beacon spokesman, and Jeremy Ryan of Potter Anderson & Corroon LLP, an attorney for Beacon in Wilmington, didn’t respond to e-mails seeking comment on the bankruptcy filing…

You will be shocked to hear that according to the FEC files, Beacon Power donated exclusively to Democrats, especially Martha Coakley and Niki Tsongas. And that Bill Capp, Beacon’s CEO gave $1,000 to Mr. Obama campaign in 2008.

This article was posted by Steve on Wednesday, November 2nd, 2011. Comments are currently closed.

6 Responses to “Beacon Power Files Bankruptcy After DOE Loan”

  1. GetBackJack says:

    As a propaganda disaster this stuff sets thee bar at a new level.

    You couldn’t do a more effective smear campaign aimed at alternative energy if you were an oil company. Right now, alternative and solar are being fire-hosed with the colors of corruption, incompetence, cronyism and hippy-dippy liberal failure by this staggering display of insider-trading, insider-payoffs and the ultimate sin, being bag-men for the Democratic Elite. And it’s sticking.

    This is serious injustice to all the firms, researchers, entrepreneurs and investors who are earnestly striving to produce low cost, renewable choice for consumers that is another step in cutting the cord of dependency.

    And when I look at this action just right, it damn sure looks like that is exactly what the crony corruptocrats of the DNC are up to. While they fleece us, they’re also tarring and feathering one of their most important voter blocs.

    Why, its almost like the DNC is on the shadow-payroll of BP.

    Wait a minute …. didn’t Obama …. BP ….

    I’m right. Again.

  2. River0 says:

    I’m shocked! SHOCKED! That George Bush’s culture of corruption persists in besmirching and bedeviling Obama and the good people of this Democrat Party and the dedicated environmentalists that labor so tirelessly for our children, and our children’s children! All around the world, wherever the United Nations spreads its benign wings….

  3. Rusty Shackleford says:

    There’s an expression that I learned in Texas: “You can’t push a string” and this is what the democrats are doing.

    But it is still unclear if they are doing it out of a benevolent desire to achieve utopia or just drain as much money out of the system so as to bankrupt it and destroy it. I think the latter possibility is becoming more clear, unless, of course it’s a “damn the torpedoes, full speed ahead” move by the statists.

    But also, it’s a curious thing about government. Their answer to everything is to throw money at it. Kids aren’t getting an education? Kids are popping up pregnant? Drug use on the ever-increasing rise? Crime is up?

    Throw money at it.

    But it’s also done in a way that is vindictive and vengeful on their part. By that I mean they want to throw money at, and only at–things conservatives find objectionable. And, it’s also very nuanced. Sure, everyone thinks a well-funded education system is a good idea; After all it’s “for the children”, right? Well, last time I looked most if not all the public sector teachers walked off their jobs to go bitch about their ridiculously high salaries, or something like that. And that they were going to have to help pay for their benefits. *sigh*

    And the children? The oh-so-beloved, so needy and dying-to-learn children? School was canceled so the teachers could go have their little tantrum.

    Occupy Madison was a precursor to this grander-but-stupidly-similar “occupy wall street” buffoonery.

    What I think we’re actually dealing with is half a century of lack-of-discipline in things that matter coming to a head. There is still roughly half the population who know how to say “excuse me” and “please” and “thank you”,. etc. Who know how not to stand in the way of someone looking for something on the shelf at the grocery store. But half of our neighbors do not. And it comes down to parenting basics. A huge FAIL on parents who let their kids “express themselves” at all times. Those of us who were not know who we are and also know that we work at our jobs and know no matter how much we dislike the boss, we keep our mouths shut. We were also taught, or learned what being gullible is. That the pea is not under any of the cups but in the slickster’s hand. We learned that Santa is myth, along with the tooth fairy, Rudolph the red-nosed reindeer and the Easter bunny…but we set aside a compartment in our brain for them when the time permits and we can afford to be whimsical.

    Those on the left still think that if they close their eyes really tight and wish really hard that all wars will stop, no one will ever go hungry and the spotted owl will always have a place to live. They have compartmentalized their brains to catastrophe. They no longer think. They are overly charged emotions with a brain at the top that is doing its best to feel all these things while still trying to tell its owner that it’s hungry, thirsty or tired and that it would like something better than a diet of Lenin and Marx and zither music.

    But they also fail to recognize that they are willing dupes for politicians who have only one agenda and that is to take the money from those who earn it.

  4. tranquil.night says:

    Great post Rusty.

    Yes, the solution to every social injustice is more tax money to launder through bigger government.

    But the point of the solution is never to solve the problem, real or concocted; that would be counter-productive to the cause of securing more tax money with which to buy votes and grow government.

  5. chainsaw says:

    Since I only have a BS in engineering, I need a little help understanding some of the financial terms here.

    “..listed assets of $72 million and debt of $47 million..” Is asset the over-priced list price of inferior inventory and building?

    and, how does changing an incentive rule double one’s revenue? Is this the same kind of “free” money that ethanol producers get?

  6. jobeth says:

    If only the banks would just issue me a loan…you know, the kind secured by the taxpayers.

    I’d like to razzle dazzle ’em with an air headed idea and convince them to make me a loan for a million or two…And then file bankruptcy…10 days later! What a game plan!

    Wow… and they call Madoff a thief!

    How can anyone, bank or CEO, create such a mess without knowing it wouldn’t work? Nope…I don’t believe in tall tales and lies.

    OK people, the criminal booking line forms on the left, just outside Holder’s office. You’ll know the place…Holder is the first in line.

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