A second company that received a U.S. Department of Energy (DOE) loan guarantee has filed for bankruptcy. Following on the heels of Freemont, Calif.-based solar company Solyndra LLC, Beacon Power Corp., a Tyngsboro, Mass.-based energy-storage firm, filed papers yesterday in U.S. Bankruptcy Court in Willmington, Del., after failing to raise private funds, Bloomberg Business reports.
‘The current economic and political climate, the financing terms mandated by the DOE, and Beacon's recent delisting notice from Nasdaq have together severely restricted Beacon's access to additional investments through the equity markets,’ F. William Capp, CEO of Beacon, said in the filing papers, according to Bloomberg.
Earlier this month, Beacon Power received a Nasdaq notice of minimum bid price noncompliance. The company was given 180 calendar days, or until March 28, 2012, to regain compliance.
Beacon Power energized and interconnected 8 MW of flywheel-based energy storage at its first frequency-regulation plant in Stephentown, N.Y., in January. The flywheel systems were designed to provide frequency-regulation services to help stabilize and enhance the performance of the New York power grid and enable the greater use of renewable energy sources, according to Beacon Power.
In August 2010, the company announced that it had closed on a $43 million loan guaranteed by the DOE for the Stephentown plant.
The DOE's loan-guarantee program, which was created to encourage alternative energy development, has come under fire from lawmakers since Solyndra LLC, which received a $535 million loan guarantee, filed for bankruptcy in August.
The U.S. House of Representatives began an investigation in September into whether Solyndra and the Obama administration engaged in wrongdoing when the loan guarantee was offered to the company in 2009.
Earlier this month, Beacon Power announced that it had hired Group Robinson, a global adviser and investment banking firm specializing in clean technology, to secure project financing for Beacon's 20 MW flywheel frequency-regulation plant, which planned for Hazle Township, Pa.
The company had secured more than half of the funding to build the $53 million project, including a $24 million smart grid stimulus grant from the DOE and a $5 million grant from the commonwealth of Pennsylvania.