Green Firms Get Fed Cash, Give Execs Bonuses, Fail

Share
Copy

'It All Happened So Quickly'

Other energy companies struggled in the storm.

Among them: SpectraWatt, a New York state manufacturer of silicon solar cells. In 2009, SpectraWatt secured a $500,000 grant from the DOE's National Renewable Energy Laboratory Photovoltaic Technology Pre-Incubator program. In March 2010, U.S. Labor Secretary Hilda L. Solis and a local congressman toured the company's Hudson Valley Research Park in Hopewell Junction, N.Y., highlighting the wave of coming green jobs.

"President Obama and I understand and believe that the first thing we have to do to turn the economy around is provide American families with good jobs," Secy. Solis said, according to a SpectraWatt press release. "That is why we are committed to investing in greening our economy."

Follow ABCNewsBlotter on Twitter

Yet, not long after, the company's momentum suddenly halted.

Last August, SpectraWatt filed for Chapter 11 bankruptcy protection.

"It all happened so quickly," Richard J. Haug, SpectraWatt's President and COO, said in an interview. The company's innovative technology, he said, butted up against changing market and pricing conditions, competition from the Chinese -- and the fact that some early investors did not follow through.

"They couldn't locate any new money," he said. "It was very disappointing."

While the DOE's early grant supported research and development, Haug said, a later funding request was denied. Last March, he said, the company laid off its workforce and effectively shut down. "It became increasingly difficult for us to make any more money. By the end of 2010 we basically dropped down to a cash level … that by March we would be out of business," Haug said.

In March, the big payouts began. Five company executives, including Haug, received six-figure payments in late March or early April 2011, bankruptcy records show. The five "insider payments" totaled more than $745,000.

Haug said the payouts were not bonuses, but accrued vacation and pay for executives that had been spelled out in severance agreements. "There were no golden parachutes," he said. "This was a very straightforward very honest group of people. I'd go to work with them again anytime."

Energy officials noted that their early investment in SpectraWatt was relatively small compared to other project financing. Late last year, the company held auctions to sell off its plant and property.

In recent weeks, several other companies backed by DOE dollars have encountered deep financial woes.

At least six Energy Department loan and grant recipients -- from electric car maker Fisker Automotive to electric-car battery maker A123 Systems to Colorado-based Abound Solar -- have laid off workers or suffered financial woes. Those setbacks come on top of the companies that have already filed for bankruptcy.

Administration officials, from Obama on down, say they continue to support the green energy mission. "There were going to be some companies that did not work out," Obama told reporters in October, after Solyndra's meltdown. "All I can say is the Department of Energy made these decisions based on their best judgments."

Click Here for the Blotter Homepage.

Page
  • 1
  • |
  • 2
  • |
  • 3
  • |
  • 4
Join the Discussion
You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus
 
You Might Also Like...
See It, Share It
PHOTO: Sabrina Allen is shown in this photo provided by the National Center for Missing and Exploited Children.
National Center for Missing and Exploited Children
PHOTO: Adam Sandler arrives at the premiere of Men, Women & Children at The Directors Guild of America, Sept. 30, 2014, in Los Angeles.
Dan Steinberg/Invision/AP Photo
Lovable Panda Triplets Get Named
ChinaFotoPress/Getty Images