The World's #1 Renewable Energy Network for News, Information, and Companies.
Untitled Document

Putting the A123 Bankruptcy in Context

You've probably already heard the news this week about a clean energy company that received a government grant filing for bankruptcy. What you may not have heard quite so clearly is that clean tech is working, for the United States and our transformation to a better, stronger, cleaner energy future.

Yesterday’s announcement from A123 Systems needs to be viewed in the context of federal government support for clean tech to jump-start this sector, and the performance of the industry as a whole.

Many More Winners Than Losers

An important context is one of the main points of the government programs in question: making investments to drive innovation and progress in important areas for the United States. Congress expected to see winners and losers when it passed the relevant legislation in 2009, and the program as a whole has seen far more winners than losers so far. As the Washington Post’s Brad Plumer says, for example:

To date, 30 battery and electric drive firms have received stimulus funding. A full list is here. Two of them, A123 Systems and EnerDel, have filed for bankruptcy so far. (They haven’t disappeared, however: EnerDel continues to operate and A123′s stimulus-funded facilities will remain open under the deal with Johnson Controls.)

Those two companies represent 18% of the vehicle battery grants, which means that 82% of that portfolio is still “performing”.

Plumer also offers as context another stimulus-funded program that’s gotten a lot of attention but has an even more impressive performance to date:

In a similar vein, of the 26 clean-energy projects that have received federal loan guarantees under a separate 1705 program, just three have filed for bankruptcy, including Solyndra, Abound, and Beacon Power. (Though Beacon is still operating and has largely paid back its federally backed loans.)

Even the full amount at risk from those three companies adds up to 6% of the portfolio, meaning that the performing piece of the investments is 94% of the whole.

The Broader Context

Another context in which to consider these developments is what’s happening to renewables in general. In short, as UCS’s president Kevin Knobloch has pointed out, throughout the economic downturn, renewables “have delivered”:

In response to targeted but limited investment (e.g. wind and solar production tax credits and stimulus spending) and policy tools (e.g. renewable electricity standards, now in place in 29 states), the nascent wind and solar industries have delivered. Over the last five years, the wind industry more than tripled its electricity output and solar PV more than quadrupled its output.  

This summer, our collective investments in wind power brought U.S. installed capacity to more than 50,000 megawatts, enough to power almost 13 million homes — “as many as in Nevada, Colorado, Wisconsin, Virginia, Alabama, and Connecticut combined”, according to the American Wind Energy Association.

The story is similar elsewhere in the world: renewable energy has been going great guns globally, despite worldwide economic challenges.

Investments in clean energy and clean tech can bring with them jobs and other economic benefits. They also are key to moving us away from dependence on fossil fuels—oil, coal, and natural gas — and the climate change troubles they bring with them.

Beyond the Political

Despite assertions to the contrary, support for clean tech in the U.S. has been and continues to be bipartisan, as Plumer and a UCS colleague point out. The same has been true for A123, as the U.S. Department of Energy reports:

A123’s promising technology has a long history of bipartisan support. In 2007, the company received a $6 million dollar grant as part of the Bush Administration’s efforts to promote advanced battery manufacturing, and the company has used $132 million of a 2009 grant from the Department of Energy.

Some will want to politicize a few failed companies, but don’t be fooled. Investments in the clean tech — private and public — are what we need to get to a responsible, viable, thriving energy future, one that strengthens our economy, enhances our security, and addresses the huge challenge of climate change.

Our greatest investment risk comes from not investing boldly enough.

John Rogers is a senior energy analyst with expertise in renewable energy and energy efficiency technologies and policies. He co-manages the Energy and Water in a Warming World Initiative (EW3) at UCS that looks at water demands of energy production in the context of climate change. He holds a master’s degree in mechanical engineering from the University of Michigan and a bachelor's degree from Princeton University.

Lead image: What does it mean via Shutterstock

Untitled Document

RELATED ARTICLES

States Already Seek To Delay Clean Power Plan

Andrew Harris, Bloomberg Fifteen states led by coal-rich West Virginia asked a federal court to stall Obama administration rules intended to c...

Stolen Solar Panels and Sabotage A Challenge for Powering India With Renewable Energy

Anindya Upadhyay, Bloomberg Disappointment spread across Tarun Singh’s face when he saw that parts of his solar power microgrid in eastern India’...

Suntech Parent Company Buys Majority Share of US-based Suniva

Ehren Goossens Shunfeng International Clean Energy Ltd., the Hong Kong-based solar company controlled by billionaire Zheng Jianming,...

Sunrise in Pakistan as the Country Delves into Solar PV

Robert Harker Pakistan has joined the list of countries that are exploring solar power as a means to bridge critical energy generat...

PRESS RELEASES

Array Technologies’ DuraTrack HZ v3 Continues to (R)evolutionize at SPI

Array Technologies, Inc. (ATI) prepares to showcase its recently launched tracking syst...

Appalachian's Energy Center assists counties with landfill gas to energy projects

The Appalachian Energy Center at Appalachian State University recently completed a proj...

Early Bird Registration Deadline for GRC Annual Meeting is This Week

The deadline for early-bird rates for registration for the biggest annual geothermal ev...

Redesigned HydroWorld.com Video Gallery

Hydropower news and information, and interesting promotional announcements are now avai...

FEATURED BLOGS

Transitioning to Net-Zero Living

Judith and Jeffrey adore living in Belfast, Maine – a quaint harbor town of Belfast, Maine. They previously res...

The True Cost of Electric Vehicles in Australia

In order to avoid increased congestion, further greenhouse warming and lessen Australia’s reliance on imported ...

The Coming Multi-trillion Dollar Energy Investment Drive

In coming years, a multi-trillion dollar low-emission energy investment drive will get underway. Three catalysts wil...

The Perfect Elevator Pitch

The elevator pitch is a concise statement that grabs attention and communicates value, ideally leading to a next step...

FINANCIAL NEWS

CURRENT MAGAZINE ISSUE

Volume 18, Issue 4
1507REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

SOCIAL ACTIVITY

Tweet the Editors! @jennrunyon

FEATURED PARTNERS



EVENTS

Doing Business in South Africa – in partnership with GWEC, the Glob...

Wind Energy in South Africa has been expanding dramatically, growing fro...

Intersolar North America 2016

Exhibition: July 12 - 14, 2016; Conference: July 11 - 13, 2016 Intersola...

Intersolar South America 2015

Exhibition and Conference: September 1-3, 2015 Intersolar South America ...

COMPANY BLOGS

The Proof Is Not Always In The Pudding

One of the best ways to turn a skeptical prospect into a buyer is to giv...

Pushing Beyond The Cushion

Efficiency projects are all too often viewed as “optional” o...

Less Is More

When you’re giving a presentation, one of the easiest things to do...

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS