Another US-Backed Energy Company Goes Bankrupt

Beacon Power adds to Obama administration's post-Solyndra woes
By Matt Cantor,  Newser Staff
Posted Oct 31, 2011 10:14 AM CDT
Another US-Backed Energy Company Goes Bankrupt
A man poses atop flywheel battery pits at Beacon Power in Stephentown, N.Y., on July 7, 2011.   (AP Photo/Mike Groll)

More potential trouble for the Obama administration: On the heels of Solyndra, another federally-backed power company has gone bankrupt. A year ago, Beacon Power received a $43 million loan guarantee from the Department of Energy, Reuters reports. The company drew down $39 million of that loan for a $69 million energy storage plant in Stephentown, New York. But the Energy Department says Beacon Power's woes aren't quite as bad as Solyndra's: The New York plant is still running despite the bankruptcy, marking a contrast to Solyndra’s shutdown.

And unlike Solyndra, the first debt Beacon must pay off is to the government, the department notes. Among the reasons for the bankruptcy are Energy Department financing rules, Beacon’s delisting on Nasdaq, and “the current political climate,” the company says. Republicans have already begun launching attacks. "This latest failure is a sharp reminder that DOE has fallen well short of delivering the stimulus jobs that were promised, and now taxpayers find themselves millions of more dollars in the hole," says Rep. Cliff Stearns, head of a House probe into the Solyndra case. (More energy stories.)

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