Skip to comments.Oregon prepares to foreclose on SoloPower as solar startup misses loan payment
Posted on 05/03/2013 6:14:41 PM PDT by jazusamo
Oregon officials are preparing to foreclose on SoloPower Inc. after the government-backed startup missed a loan payment this week in the latest setback for the state's reeling green-energy sector.
SoloPower, which is still scrambling to revive its struggling North Portland plant, missed a $50,800 payment Wednesday on a $10 million loan from the Oregon Energy Department, an agency spokeswoman said Friday.
If the San Jose, Calif., company defaults, Portland taxpayers could be out $5 million, because the city guaranteed half the loan last year in wooing the plant away from Wilsonville.
Already the state of Oregon is out $20 million in state tax credits issued to SoloPower, which is scheduled to close its factory next month, barring arrival of a white knight bearing fresh capital. Energy officials are working with Oregon Justice Department lawyers on the case, said Diana Enright, an Energy Department spokeswoman.
"We're working with them in preparation of a foreclosure or any other collection proceedings that are allowed by the loan documents," Enright said. "We believe we have sufficient collateral to cover the $10 million," in the form of manufacturing equipment.
SoloPower is the latest and most visible casualty in a green meltdown spreading across Oregon, where state and local officials showered incentives on companies that promised thousands of jobs. Solar manufacturers have gone under or laid off workers amid a worldwide glut that dragged prices below the cost of production.
SoloPower, which tried to develop solar panels in thin sheets for rolling onto rooftops, planned a $340 million factory that would ultimately employ 450. Instead, the company plans to lay off a skeleton crew of 29 workers June 17, and close, probably for good.
Company managers declined through a public relations firm Friday to comment on finances. They repeated assertions that SoloPower is in discussions with potential new investors.
Enright said that technically all borrowers have a five-day grace period for payments, giving SoloPower until the close of business Monday to make its payment. The company has made 11 of the interest-only payments so far, she said. It had received $10 million of the loan, originally set for $20 million. It was also approved for a $20 million state Business Energy Tax Credit worth $13.5 million to the company.
The city of Portland guaranteed $5 million of the energy loan, using parking meter revenue to be collected by the Bureau of Transportation. In a complex deal, the Portland Development Commission pledged urban-renewal tax revenues to backstop the $5 million guarantee.
Therefore, if SoloPower defaults, the PDC would reimburse the city by putting $5 million in tax increment financing toward a Transportation Bureau project. The PDC and the state could recoup their money from the sale of SoloPower factory equipment, which might be worth more than $10 million despite the depressed market for solar manufacturing machinery.
Fallout continues in Oregon's solar manufacturing sector, whose prospects appeared bright not long ago. On April 26, Salem managers of a Sanyo Solar plant that opened in 2009 with $45 million in government subsidies said they would lay off 52 of their 200 workers.
The news came as SolarWorld, a German company that employs 700 at a state-subsidized Hillsboro plant, scrambled to restructure in a giant proposed debt-for-equity swap. On Thursday, SolarWorld Chief Executive Frank Asbeck told Reuters he would soon reveal the size of a potential investment by an unnamed backer from Qatar.
The Oregon tax payers can kiss those millions of green goodbye.
“A fool and his money are soon parted.”
These little green money pits are drowning in an ocean of oil and gas from freedom-loving states that are fracking the U.S. to energy independence. The days of lousy corn ethanol should be numbered, too. There was positively no future in using our farmland to make fuel additives that cut down on engine efficiency in our vehicles.
Will they ever learn?
Or will they blame this on intransigent conservatives who refuse to go into debt to purchase grossly overpriced, inefficient solar power systems?
You’ve got that right, ethanol is a loser from all sides. It takes government subsidies to keep it going and is not cost effective.
Thanks Sal, did everything go well?
Once upon a time, not that long ago, standard 250 watt solar panels were selling for about $5 per watt or $1250.
Those same panels are now selling for about $0.80 per watt or $200. And, the price is projected to fall to $0.50 per watt in the near future. That would result in $125 panels.
Note: this was widely predicted but, apparently not believed by the fools who funded all these failed and about to fail green solar companies. In the end, coming soon, they will all be gone.
OTOH, at the low prices that panels are now selling for, the “Chinese Content” of a typical solar installation is not the major cost driver. Most of the cost is labor, hardware, inverters, wiring, permits and fees. Most of that money stays in the good old USA.
And the subsidies are slowly but surely disappearing. Very soon we will see if the real American solar industry, the design and installation of solar systems, can stand on its own two feet.
“The PDC and the state could recoup their money from the sale of SoloPower factory equipment, which might be worth more than $10 million despite the depressed market for solar manufacturing machinery”
A pack of rabid Howler Monkeys might fly out of my butt, too. They won’t get more than ten cents on the dollar for that stuff. And I bet the Chinese end up with all of it.
Oregon? Who give a crap what happens to this liberal bunch of idiots.
This company was originally going to set up in a small town next door called Wilsonville. They were going to give incentives of 5 million and one guy stopped them and they went to Portland. nice move Portland.
Pray for America to Wake Up
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