Bankrupt Evergreen Solar's U.S. Govt. Benefits Mostly Unreported, Probably Impossible to Track
On August 15, the Boston Herald, the Boston Globe, and the Associated Press all reported that Massachusetts-based Evergreen Solar had filed for Chapter 11 bankruptcy. Oddly enough (no, not really), The New York Times, which published a 1,600-word report in January (HT to an NB emailer) on the company's competitive difficulties, did not take note of Evergreen's filing.
Each of the three reports cited gave readers the impression that Bay State agencies were the only ones which had provided the company any form of financial assistance during the past several years during which, according to its latest 10-K annual report (large HTML file), it was losing hundreds of millions of dollars annually (about $950 million in the past three calendar years):
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(from the Boston Herald's full report)
Evergreen Solar Inc., the Massachusetts clean-energy company that received millions in state subsidies from the Patrick administration for an ill-fated Bay State factory, has filed for bankruptcy, listing $485.6 million in debt.
... The Massachusetts Republican Party called the Patrick administration’s $58 million financial aid package, which supported Evergreen’s $450 million factory, a “waste” of money.
... In January, after Evergreen announced it would close the Devens factory, Patrick told the Herald he was disappointed in the job losses but did not regret making the investment.
(Boston Globe -- Note: A terse, four-paragraph report)
Evergreen Solar Inc., the once promising alternative energy company that received millions in state subsidies, revealed today that that it has voluntarily filed for Chapter 11 bankruptcy protection.
(Associated Press -- Note: Another terse, four-paragraph report)
A solar energy company that received millions of dollars in grants and tax incentives from Massachusetts before closing one of its facilities in the state has voluntarily filed for Chapter 11 bankruptcy relief.
It took David Mastio at the Washington Times to visit the White House's web site and note that Evergreen was identified in April 2009 as a beneficiary of federal ARRA (American Recovery and Reinvestment Act), or "stimulus," funds. Here is portion of the White House's statement:
To: Interested Parties
Fr: White House Communications
Da: April 22, 2009
Re: The Obama-Biden economic plan: creating jobs, strengthening the economy for Massachusetts families
Facing the worst economic crisis since the Great Depression, President Obama started his Presidency with decisive action -- proposing and quickly passing the American Recovery and Reinvestment Act (ARRA).
... here’s a look at how his policies have impacted Massachusetts in the first three months of his administration.
... Because of the Stimulus Bill and New Contracts, Green Energy Companies Are Looking to Hire Many New Employees.
... Evergreen Solar, the Marlborough-based maker of solar panels, also is hoping to hire 90 to 100 people at a manufacturing plant in Devens, said Gary Pollard, vice president of human resources.
... Evergreen Solar Was Hoping to Hire 90 to 100 People for Its Manufacturing Plant. "Evergreen Solar, the Marlborough-based maker of solar panels, also is hoping to hire 90 to 100 people at a manufacturing plant in Devens, said Gary Pollard, vice president of human resources. The plant, which opened last summer, is expected to employ more than 800 when it reaches full capacity." [Boston Globe, 3/6/09]
It's clear that at least the Globe knew that Evergreen was a beneficiary of significant federal government largesse, and chose to ignore that fact. The introduction to Its March 6, 2009 article (full article is behind the Globe's pay wall) reads as follows (bolds are mine throughout the rest of this post):
Renewable job market
Even as economy worsens, state's green companies are hiring
According to a spokesman for congressman Ed Markey, the Malden Democrat who chairs the Select Committee on Energy Independence and Global Warming, Massachusetts is set to get $125 million in stimulus funds for weatherization projects and $55 million in state energy block grants to be used mainly for energy-efficiency programs. According to a recently released report from his firm, the legislation contains about $83 billion for "clean-tech spending and tax plans" and positions the industry as a "key driver of economic stabilization and job growth."
"His (Markey's) firm"? I do hope the Globe really meant "his committee."
As the White House announcement noted, Evergreen's hiring plans as a result of ARRA appear later in the Globe report.
The fact that the Globe failed to report what it knew of Evergreen's stimulus involvement made it easy for the Associated Press, whose report closely mirrors the Globe's, to ignore it as well.
So how much stimulus money, or indirect benefit, did Evergreen receive? Good luck getting your arms around that.
As far as stimulus reporting requirements are concerned, all that apparently had to be reported about who benefitted from the $55 million block grant noted above (which is in the state's stimulus report) was its gross amount and the fact that the Massachusetts Department of Energy Resources originally got the money, as seen below (part of full ARRA report as of September 30, 2010; numbers reformatted to get rid of cents and to include commas):
It may be in the Bay State's Recovery Act web site somewhere, but I could not find any breakdown of who might have received those funds.
There are anecdotal items which contain some detail, such as this one from a Massachusetts paper which was linked from the Bay State's ARRA website:
Renewable energy companies from Holliston and Marlborough will play key roles in what is likely the largest-ever project to install solar panels on state-owned facilities.
Renewable Sales of Holliston, a wholesale distributor, said it will supply 11,000 photovoltaic panels manufactured by Marlborough-based Evergreen Solar for the initiative.
The $9.8 million plan includes $5.3 million in federal stimulus cash.
The solar equipment will go up on 11 state colleges and universities - including Framingham State - a recycling facility in Springfield and an education center at Chickatawbut Hill in Milton.
"It's the largest project we've ever landed," said Kevin Price, president of Renewable Sales. "What we were excited about was not just winning the project for us, but keeping the money in the commonwealth."
The Berkshire Community College project illustrates how the Patrick-Murray Administration's push for renewable energy is putting Massachusetts companies to work. Financed with $984,400 in federal funds available under the American Recovery and Reinvestment Act (ARRA) and $758,388 in federal low-interest Clean Renewable Energy Bonds, the rooftop systems comprise inverters made by Solectria of Lawrence and panels from Evergreen Solar of Devens, which are being installed by Ostrow Electric of Worcester. Once complete later this fall, the system is expected to produce 440,000 kilowatt hours (kWh) of electricity - enough to supply over 20 percent of the school's demand.
So who was the actual recipient of the stimulus cash, i.e., who got check(s) to take to the bank? Renewable Sales? Evergreen? Some general contractor who actually installed the panels? I can't tell, but there is little doubt that Evergreen benefitted at the very least to the tune of millions of dollars by being able to sell panels, possibly at inflated prices, which it otherwise would not have sold. As far as I could tell from reviewing its financial statements, Evergreen treats its entire business as one reportable segment for financial reporting purposes, meaning that there is no breakdown of residential, commercial, and government sales.
One thing is for certain: The deliberately selective (in the case of the Globe) and incomplete (in regards to the others) reporting of which governmental entities gave aid to Evergreen Solar conveniently covers up what has to be seen as yet another in a long, long list of examples where federal government stimulus funds were ultimately largely wasted.
Cross-posted at BizzyBlog.com.