By now it’s obvious that the Solyndra scandal never should have happened. It’s not even a case of Monday morning quarterbacking. A number of people involved could see the disaster coming.
There is a larger principle here. Government should not use taxpayer money to socialize risk while privatizing profits. Examples such as Colorado-based Abound Solar, which received a $400 million loan guarantee, prove that crony capitalism simply rewards the well connected at taxpayer expense.
Abound Solar, according to its Web site, “produces next-generation thin-film cadmium telluride solar modules” and “is committed to reducing the cost of solar electricity to levels competitive with fossil fuels.”
It is the brainchild of former Colorado State University (CSU) Professor W.S. Sampath and two former students Kurt Barth and Al Enzenroth. It began as AVA Solar and then incorporated into Abound in 2007.
The Web site says it employs 350 people in three Colorado locations. Its Colorado manufacturing plant is located in Weld County, which granted Abound up to $100,000 per year for the next ten years in business property tax rebates. According to sources, the reason for the rebate was job creation intended to benefit Weld County residents. Yet when officials and interested parties ask how many of the 350 jobs have gone to Weld County residents, the solar company does not answer.
Currently Abound has a manufacturing capacity of 65 megawatts expanding to 850 megawatts – at some point. However, in 2010 it manufactured only 30 megawatts. One wonders, if Abound can produce more, why doesn’t it?
The Web site does say it is “growing,” and news reports claim the company plans to add anywhere from 850 to 1,000 employees thanks to a $400 million taxpayer-guaranteed loan Abound received in July 2010. The taxpayer cash is so it can expand its manufacturing capabilities to a facility in Tipton, Indiana. The Indiana Economic Development Corporation “extended up to $11.85 million in tax credits and $250,000 in training grants” as well.
Abound Solar further claims $260 million in private investments, part of which came from billionaire medical heiress Pat Stryker’s Bohemian Companies. This is where the story gets interesting.