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Beacon Power goes bankrupt, despite millions from NYS and feds
Beacon Power Corporation, a Massachusetts-based renewable energy company, is declaring bankruptcy - after receiving federal funds from the same program that subsidized the failed solar firm Solyndra.
The company also received funding from New York State.
Last July, Beacon Power celebrated the opening of its new flywheel plant in Stephentown, N.Y.
The flywheels were designed to help modernize the state’s power grid. They act as a sort of shock-absorber, to quickly store and release energy to the grid.
The project received $43 million from the United States Department of Energy, and $2 million from New York’s Energy Research and Development Authority (NYSERDA).
But over the weekend, Beacon Power filed for Chapter 11 in a U.S. Bankruptcy Court in Wilmington, Delaware. The filing came just a few days after the White House ordered a review of the Energy Department’s loan program.
In an email statement to the Innovation Trail, Department of Energy spokesman Damien LaVera wrote:
“It is important to note that this plant itself, which is operational and generating revenue, is a valuable collateral asset. In addition, under the terms of our loan guarantee agreement, Stephentown Regulation Services, LLC currently has cash reserves and proceeds from the plant that it was required to hold as collateral on the loan. Because the plant is nearly completed and under budget, $4 million of the loan guarantee amount has yet not been tapped by the company. Finally, this loan is the only senior, secured lender of the Stephentown project company, which owns the plant.”
LaVera added that, unlike Solyndra, Beacon Power won’t shut down completely. The company plans to restructure, although some layoffs could result.
In August 2010, the Innovation Trail profiled Beacon Power on WMHT’s New York NOW: