creators.com opinion web
Liberal Opinion Conservative Opinion
Daily Editorials
17 Apr 2015
The Start of the Trail

No surprises so far; Hillary Clinton is once again viewed as the inevitable candidate for the Democrats. That didn'… Read More.

17 Apr 2015
Advance From Fast Food to Earn a Better Wage

Fast food workers rallied throughout the country Wednesday to demand wages of $15 an hour — more than … Read More.

16 Apr 2015
Government Wins Day

If you are reading this today then there still is time to file that return and send the government your money.… Read More.

No More Tax Money for Green Energy

Comment

It soon may be time to pull the plug on Fisker Automotive, the Southern California-based manufacturer of plug-in electric vehicles.

First came word late last week that the green company had abruptly laid off 160 of its 213 remaining employees (which prompted a lawsuit charging that the displaced workers were not given sufficient notice).

Now come rumblings that Fisker intends to file Chapter 11 bankruptcy this week or next, while at the same time holding talks with possible buyers or investors to salvage the foundering carmaker.

It remains to be seen if the once-seemingly promising electric carmaker manages to stay in business or joins the once-seemingly promising solar panel manufacturer Solyndra in oblivion.

Either way, Fisker provides a business-school-worthy case study in how not to invest in start-up companies in nascent industries.

Indeed, in a presentation this past fall at MIT's annual EmTech conference, Bill Banholzer, chief technology officer for Dow Chemical, cautioned investors that it was mistake to throw money at green energy start-ups, which promise to bring disruptive technologies to market.

Banholzer's PowerPoint included a slide with a dozen green energy companies, including the aforementioned Solyndra, A123 Systems, which was to supply state-of-the-art lithium batteries to Fisker and other electric car manufacturers, and other much-hyped start-ups.

Between them, the dozen green energy companies received billions of dollars in investment not only from private venture capitalists, but also from the federal government and green-driven state governments.

Yet, as Banholzer pointed out, "returns are not at all what people would expect."

And Solyndra, A123 Systems, Range Fuels, Boston Green Power and the other failed or foundering green energy companies were hardly outliers.

As Dow Chemical's CTO told investors at EmTech, "The issue is not just specific companies. Entire industry segments are failing."

Indeed, Banholzer's assessment is corroborated by the BNP Paribas Renewable Energy Index, which tracks roughly 40 of the world's largest green-industry companies. Since 2007, when investors were gaga for green energy, the index has plummeted nearly 90 percent.

It's one thing for private venture-capital firms to lose billions of dollars on green energy. It's quite another for the federal government to squander tax dollars, including $535 million on Solyndra, $435 million on A123 Systems and $528 million on Fisker Automotive ($200 million of which the company spent before the feds suspended its funding).

Congress should explicitly forbid the Obama administration from making any further "investments" in green energy companies, the failures of which should not come at the expense of taxpayers.

REPRINTED FROM THE ORANGE COUNTY REGISTER

DISTRIBUTED BY CREATORS.COM



Comments

0 Comments | Post Comment
Already have an account? Log in.
New Account  
Your Name:
Your E-mail:
Your Password:
Confirm Your Password:

Please allow a few minutes for your comment to be posted.

Enter the numbers to the right:  
Creators.com comments policy
More
Newspaper Contributors
Apr. `15
Su Mo Tu We Th Fr Sa
29 30 31 1 2 3 4
5 6 7 8 9 10 11
12 13 14 15 16 17 18
19 20 21 22 23 24 25
26 27 28 29 30 1 2
About the author About the author
Printer friendly format Printer friendly format
Email to friend Email to friend
View by Month
Marc Dion
Marc DionUpdated 20 Apr 2015
Deb Saunders
Debra J. SaundersUpdated 19 Apr 2015
Steve Chapman
Steve ChapmanUpdated 19 Apr 2015

28 Sep 2013 The Tragedy of Grover Norquist

15 Jun 2010 Bigger Toolbox Needed

28 Apr 2010 Stop the Spending To Cut Debt