In July 2012, Abound Solar announced that it would file for bankruptcy, leaving taxpayers responsible for $70 million in loans. This photovoltaic company's liabilities are estimated to be between $100 million and $500 million. In fact, this was one of the largest corporate bankruptcies in Colorado's past. Initially, the company stated that it would reorganize under Chapter 11 bankruptcy, but it has since vacillated between filing Chapter 7 and Chapter 11 bankruptcy. Abound Solar has recently announced that it will file for Chapter 7 bankruptcy, cease operations, and dissolve.
These federally supported loans are distributed not only to solar companies, but also to green power companies such as Nevada Geothermal Power. Nevada Geothermal Power received a federal loan guarantee for $98.5 million while the company struggled and was not financially solvent. This loan appears to have been more of a bailout than an investment. Ohio Republican Congressman Jim Jordan stated that Nevada geothermal was already in dire financial straits prior to the federal loan guarantee.
The company's auditor stated in a report dated March 31, 2012,
The company's ability to continue as a going concern depends on its available cash and its ability to continue to raise funds to support corporate operations and the development of other properties; therefore, there are material and certainties that cast substantial doubt on the company's ability to continue as a going concern.
It appears to have been used to shore up a company that was already in decline. Harry Reid, a Nevada Democrat, was a firm supporter of the loan given to Nevada Geothermal. In 2010, the senator was instrumental in securing the inclusion of the loan in the $814 billion stimulus bill.
A123 Systems was another company that left the taxpayer on the line for $249,1 million. Due to a dearth of sales in the electric vehicle industry, the electric car battery manufacturer announced that it would file for Chapter 7 bankruptcy. As a result of the failure of the Chevrolet Volt, this is hardly a surprise.
In the past decade, there has been a tremendous push by the federal government to subsidize and mandate clean energy. The only issue is that it is not a cost-effective solution and has unintended consequences. To find an example of a failed green economy, we need look no further than Spain, whose unemployment rate exceeds 20 percent. The green movement is intended to safeguard the environment, but ecologists have reported that birds are being killed and mutilated at enormous wind farms. In New England, communities are complaining about the constant, loud noise caused by their use of wind energy.
Numerous energy analysts assert that plausible solutions exist for our energy problems. Using technology, the coal industry has been able to become a clean-burning source of energy and utilize the extensive coal reserves that are now being exported. The United States has vast oil and natural gas reserves that can be utilized with minimal or no environmental risk and without spending a dime in tax dollars. As the number of federally funded green companies declaring bankruptcy continues to grow, the taxpayer is growing weary of bearing the bill. The only beneficiaries of these investments are the chief executive officers of Green companies and their bankruptcy attorneys.""
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