Green money hole: Subsidized battery maker bleeds

Before Solyndra went bankrupt, but after it received a half-billion dollars in federal aide, the solar maker announced it was cancelling its planned expansion, and would not be making the new hires the subsidy was supposed to bring.

Before Range Fuels’ wood-chips-to-ethanol plant was liquidated, but after it received nine-figure subsidies from federal and state corporate-welfare agencies, the plant shuttered its doors, supposedly temporarily.

You see the three-step process: (1) Supposedly promising green energy company pockets government subsidies to the promise, from politicians, of many jobs; (2) green energy company takes a big financial hit, scraps the supposed jobs boost; (3) green energy company goes under.

Battery maker A123 is at stage two in this process. Paul Chesser at the National Legal and Policy Center reports:

A123 Systems, Inc. The Massachusetts-based energy storage company was given $249.1 million to help launch two battery-manufacturing plants in Michigan. A123 also received grants and tax credits from the state that could total more than $135 million. In a separate federal grant as a subcontractor for another grantee, A123 received nearly $30 million for a wind energy storage project.
In the Wolverine State, the company will lay off 125 employees at the two plants in Livonia and Romulus. Officials said diminished production by a top customer – Irvine, Calif.-based Fisker Automotive – led to the cutbacks. A123 had expected to deliver batteries for 7,000 plug-in hybrid Karma models, but faulty wire harnesses in the vehicles reduced Fisker’s production to 1,500 for 2011, according to Crain’s Detroit Business.

In the video above can see A123 CEO David Vieau, a maxed-out donor to Obama in 2008, publicly lobbying for a cap-and-trade “energy bill” that would effectively subsidize his company.

A123, I should mention, was one of General Electric’s big “Ecomagination” investments. GE is famously cozy with the Obama administration, and it spends more on lobbying than any other corporation.

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