Green Technology Makes OC Register See Red
Anaheim-based Fisker is expected to file for bankruptcy any day now after a series of bad business decisions and just plain bad luck. About 75 percent of its workforce unexpectedly received pink slips and no severance pay last week. Arriving with much fanfare and the plug-in hybrid Fisker Karma at the 2008 North American International Auto Show, the company would go on to see production delays, vehicle recalls, cash-flow problems, Hurricane Sandy wiping out 300 cars on the East Coast and founder Henrik Fisker's resignation.
The Register editorial, which we'd link you to were it not for the damn paywall, argues the Fisker story in indicative of green companies being bad investments unworthy of government assistance:
. . . 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.
Mr. 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.
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.
Now here's Media Matters (which I will link to):
While the PowerPoint presentation by Banzholzer--whose Dow Chemical just lost a suit over the $1 billion in tax deductions the company tried to put into tax shelters forcing it to pay a 20 percent penalty--highlighted the failures of several green energy companies, this anecdotal evidence obscures key facts about the green energy industry as a whole. Due to increases in federal investment, the U.S. clean tech industry has grown rapidly. The cost of solar panels has dropped significantly over the last several years and is on track to be as cheap as our current electricity by 2020. Wind turbine manufacturing and installed wind capacity have also grown significantly. According to the National Association of Manufacturers, "US wind turbine manufacturing has grown 12-fold" since 2005 while "costs have been reduced by 90% since 1980."
Yet, much of the federal government's subsidies still support fossil fuels. Of the four major permanent (never expiring) energy tax credits, three are for fossil fuels and one is for nuclear energy. On the other hand, most of the major subsidies for green energy -- which came into effect in 2006 -- expired in 2011.
By the way, I came upon the Media Matters tip in my email inbox, right before one from the Register detailing today's political stories in the paper. At the top of the heap: results of a poll showing the majority of Republicans don't believe sea levels are rising.
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