Another one bites the dust
Making national news, another heavily tax-subsidized alternative energy operation — the Amonix solar manufacturing plant in North Las Vegas — went belly-up last week, closing its 214,000-square-foot facility a year after it opened.
A designer and manufacturer of concentrated photovoltaic solar power systems, Amonix received $6 million in federal tax credits for the North Las Vegas plant and a $15.6 million grant from the Bush-era U.S. Department of Energy in 2007 for research and development.
Amonix isn’t the only solar company to go under after receiving a whopping tax infusion. California-based Solyndra filed for bankruptcy last year after receiving $535 million in federal loan guarantees from the Obama administration. In fact, President Obama visited Solyndra’s California plant, touting it as an example of how the government can choose “clean energy” winners, “leading the way toward a brighter and more prosperous future.” Mr. Obama called Solyndra a success of the government’s $787 billion economic stimulus package … two months after auditors from PricewaterhouseCoopers warned the company had proven unable to produce a product that could sell at a market price and might go bankrupt.
And Colorado-based Abound Solar, which received a $70 million loan guaranteed from the Energy Department, filed for bankruptcy in June.
Rene Kenerly, a former material and supply manager at Amonix, said the plant has been idle since May 1, when he was laid off. At its peak, the plant had ramped up to about 700 employees working three shifts a day.
But “I don’t think they had a lot of training,” Kenerly said. “There were a lot of quality issues. A lot of stuff was coming back.”
In fact, former workers describe the outfit as disorganized and lacking in both training and quality control. They report the company had to expand its storage capacity to make room for all the defective panels that were returned.
Ring any bells? Remember reading about miles of railroad track being laid as fast as possible here in the West to earn government subsidies back in the 1860s — rail that later had to be re-laid or even re-routed around swamps and marshes so it could actually be used? Read Burton Fulsom on how Cornelius Vanderbilt — operating WITHOUT subsidies — drove out of business competitors whose government subsidies convinced them they had no need to offer safe, modern passenger boats that could consistently operate on schedule.
Isn’t it interesting how quality standards and actuarial acuity change when the capital put at risk if not your own or that of friends and family who will let you hear about it over Thanksgiving dinner, but rather tax dollars whose disappearance will be blamed on everyone … and no one?
The Amonix plant was highly touted when it opened in 2011. Nevada Sen. Harry Reid, U.S. Rep. Shelley Berkley, D-Nev., and Gov. Brian Sandoval were among those who expressed high hopes.
That led to some inevitable political sniping, last week.
“Congresswoman Berkley, when you voted for the trillion dollar stimulus, you promised it would create 34,000 jobs in Nevada,” wrote Chandler Smith, spokeswoman for Republican U.S. Sen. Dean Heller. “You pushed $6 million in funding to a company that has created zero long-term jobs for Nevada. It’s time for you to admit the stimulus — and your policies — aren’t working.”
“Senator Heller is cheering the fact that hundreds of Nevadans have just lost their jobs because he thinks it will help his political campaign,” responded Xochitl Hinojosa, communications director for Berkley, who’s challenging Heller for his Senate seat.
“Last year, Amonix CEO Brian Robertson was tragically killed in a plane crash and unfortunately the company was unable to recover from this difficult time,” added the state’s senior senator, Harry Reid, in an e-mail statement. “Some people will be tempted to use today’s unfortunate news for political gain. But I am hopeful that the bipartisan support for this project and the public-private partnership that helped make this and many other projects possible will not be degraded by dirty energy supporters for their own profit or political gain. The clean energy sector is too important to Nevada’s future and I hope that those that publicly acknowledge this will continue to strengthen the bipartisan support for renewable energy programs and incentives that exists in Nevada.”
Sen. Reid is half right. This should not be a partisan issue. If the American economy is to recover and prosper, it needs plentiful, inexpensive energy. Those who divert hard-won tax dollars to subsidize pals with lobbying muscle in Washington (such as one of Solyndra’s largest private investors, Oklahoma billionaire and top-tier Obama fundraiser George Kaiser) take on a high level of fiduciary responsibility. “Investing” those funds in a firm that could be brought down by the loss of one man in a plane crash does not meet that high standard, no matter which party is responsible.
Solar energy shows promise. Those who wish to develop it — with private capital — should be welcomed. If they can work the cost of production and delivery down to the point where it’s cheaper than today’s clean oil and natural gas and cleaner-than-ever coal and nuclear, the market will reward them.
But politicians of both major parties merely prove here, once again, that there’s a reason the forms of government in which politicians run their nations’ electrical utilities as political honey jars keep collapsing, around the world.
“Public-private partnerships” is nothing but a euphemism for the corrupt boondoggles and graft extravaganzas now seen belly-flopping all around us, like exhausted hippos goaded to dance on tiptoe.
Private utilities should be left free to maximize return for their investors, while offering consumers the cheapest possible power, by buying the cheapest energy that can be produced within reasonable environmental standards — by which I mean sensible limits on toxic sulfur gases, not fake, results-guided science pretending to be concerned with the release of the harmless gas carbon dioxide, necessary to life on earth.
To learn the sharply limited number of places where tax moneys may be spent, on the other hand, read the Constitution.