Monday, October 31, 2011

Second Energy Department-backed Company Goes Bankrupt

In another showing of brilliant due diligence a second alt+energy company, funded with your tax dollars, bites the dust:

Second Energy Department-backed company goes bankrupt - The Hill's E2-Wire.

Beacon Power Corp., which develops energy storage systems, filed for bankruptcy protection in the U.S. Bankruptcy Court in Delaware.

Beacon Power had received a federal loan guarantee to help build an energy storage plant in Stephentown, N.Y., that began operating in January. The Treasury Department’s Federal Financing Bank provided the loan.

Beacon sought bankruptcy protection two days after the White House ordered an independent 60-day evaluation of the Energy Department's loan programs aimed at ensuring effective management and monitoring.

The review, conducted by a former Treasury Department official, will include examination of how Beacon’s project is performing going forward, and whether there are additional steps that can be taken to protect taxpayers, according to the Obama administration.

Beacon is a publicly traded company. At one time, early in this century, the shares fetched over $90. The company has never made any money. Grab a stiff drink and check out the Beacon website if you would like to run through their annual financial performance. ahem

Business Week and Bloomberg have even more on the story:
Beacon Power, Backed by US Guarantee, Files for Bankruptcy

Beacon plunged 33 cents, or 73 percent, to 12 cents at 2:23 p.m. New York time in Nasdaq trading, after dropping as much as 76 percent. Before today, the shares had declined 80 percent this year, prompting Nasdaq to warn Beacon that its stock might be delisted because the price had fallen below the $1 minimum.

The stock closed today's trading session at $0.11 per share - well on its way to doughnut land.

This is far from the end. I fear we will be hearing about a lot of troubles with these alt+energy loans.

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