Skip to comments.DOE Hiding Truth About Bankrupt Abound Solar's Defective Panels
Posted on 10/11/2012 11:43:23 AM PDT by jazusamo
As the now-bankrupt stimulus loan recipient Abound Solar filed for Chapter 7 (liquidation) bankruptcy in early July thanks largely to its defective modules, theDepartment of Energy still praised the companys work as innovative and cost competitive, all while it blamed Abounds failure on China for dumping underpriced panels on the market.
And now, despite the fact that Abound no longer exists, DOE is still withholding public information about the company because it claims it would harm the inactive businesss competitive edge by disclosing trade secrets.
The Daily Caller reported last week that the company sold defective or underperforming products, and cited inside sources at the company who claimed officials knew their panels were faulty before they received taxpayer dollars. Abound received a reported $70 million out of a total$400 million stimulus loan guarantee financing that was closed on in December 2010, two months after Abound knew its panels were catching fire before DOE cut it off. The news site reported that the companys lead quality engineer blew the whistle in an October 2010 managers meeting but was basically told to shut up and sit down.
Our solar modules worked as long as you didnt put them in the sun, an internal source told The Daily Caller News Foundation.
The Complete Colorado and Colorado Watchdog first reported news of trouble at the Loveland, Colo.-based solar manufacturer. Complete Colorado discovered in March that Abound had a previously unannounced work shutdown over the holidays last year in which employees were told they would have to use their vacation pay benefits to receive compensation between Dec. 23 and January 2. The memo that went to all Abound employees admonished, Dont let the rumor mill create false purposes for this shutdown.
Then in a May report Colorado Watchdog discovered that billionairess Pat Stryker, an investor in Abound who was also a2008 bundler for President Obama, was a victim of Abounds poor-quality products. A November 2010 email obtained by reporter Todd Shepherd revealed that an Abound salesperson asked a company engineer to go to Strykers Bohemian headquarters to take down the broken modules (I think 14 total) as well as 4 that we shipped them originally . The email indicated that the four panels would undergo failure analysis.
Colorado Watchdog also noted a March House Congressional Oversight Committee report titled The Department of Energys Disastrous Management of Loan Guarantee Programs which explained how credit evaluator Fitch Ratings described Abound as lagging in technology relative to its competitors, failing to achieve stated efficiency targets, and expecting that Abound Solar will suffer from increasing commoditization and pricing pressures. Fitch determined there was only a 45-percent likelihood that Abound would repay its loan to taxpayers. Given the timing, The Complete Colorado presciently wondered, Did Abound have a bad product and the DOE knew it?
That Fitch had the perceptiveness that Abound was a disaster waiting to happen, while DOE totally missed it, is an indictment of DOEs judgment and management. Nevertheless when agency spokesman Damien LaVera announced the pending bankruptcy in late June, he blamed China and glossed over the taxpayer losses.
Abound was an innovative manufacturer of next-generation, cadmium telluride thin-film photovoltaic modules that had developed and demonstrated a process for producing thin-film solar panels at a cost that was expected to be substantially less than traditional solar panels, LaVera wrote.
He explained in it wasnt just us fashion how Abound had raised more than $300 million in private financing by December 2011. However, its likely that many of those investors got involved because DOE had shown faith (without justification) in Abound, indicating the company was a worthwhile bet. He then blamed China for undercutting the U.S. solar panel market with their own governments subsidies.
Because of the strong protections we put in place for taxpayers, the (DOE) has already protected more than 80 percent of the original loan amount, LaVera wrote, as though he deserved some sort of commendation. Once the bankruptcy liquidation is complete, the Department expects the total loss to the taxpayer to be between 10 and 15 percent of the original loan amount.
That was LaVeras way of avoiding having to say that DOE lost $40 million to $60 million of your money.
Despite LaVeras oh well attitude, Abound is under investigation both by the district attorney for Weld County, Colo., and by Congress. The company received a $100,000 tax break from the county in 2010, and according to Denvers ABC news affiliate , the county seeks $1 million in unpaid property taxes for 2011 and $800,000 for 2012. The television station also reported that U.S. Rep. Cory Gardner, a Republican that represents the northern Colorado district where Abounds plant was located, will seek an investigation via the Energy and Commerce Committee on which he sits.
The question is did the (Department of Energy) -- did they know something that the rest of should have known? Gardner told the ABC station. Did Abound not tell the DOE something? These are questions that need to be answered.
DOEs heavily redacted response to a Freedom of Information Act request from Colorado Watchdog doesnt give much hope that straightforward answers will come. The news site requested all benchmark tests for Abounds panels from the National Renewable Energy Laboratory, which certifies the efficiency of renewable energy products for DOE.
Abound Solar has substantial commercial interest in protecting the release of the redacted confidential module test data within the responsive records, since the public release of this confidential information could be used by competitors to gain an undue advantage over Abound Solar, said NRELs response letter to Watchdog.
It sounds more like the interest is in protecting DOE from further embarrassment. Now even Chinas solar industry is imploding, as NLPC reported in late August. Not only are the companies they funded going bankrupt, but so also is DOEs credibility.
Paul Chesser is an associate fellow for the National Legal and Policy Center and publishes CarolinaPlottHound.com, an aggregator of North Carolina news.
So much for green energy being safe.
When is this whole crazy interest in energy that’s nowhere near as efficient as fossil fuels going to go away?
Our country is in dire economic straits while solar and wing power is fantastically expensive but our government just keeps subsidizing it. It's pathetic.
wing = wind
Stryker, Jared Polis, Tim Gill, and Rutt Bridges are known in Colorado political circles as the “Gang of Four”. Significant political contributions from the four to favored Democratic candidates has played a role in electing a Democratic majority in Colorado's house and senate.
Sounds like Pat is a dyed in the wool leftist.
BRUNCH OF CROOKS SOLAR should be the name of it...
Yes, leftist. Never earned a thing in her life.
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