Clean Energy Can’t Compete
The solar company Evergreen announced last week that it is shutting its Massachusetts plant and will lay off 800 workers. That’s the same plant Massachusetts Governor Deval Patrick had state taxpayers fund in 2007 to the tune of $58 million in grants, loans and land and tax incentives — one of the largest investments in a private company in Bay State history, says the Wall Street Journal.
Evergreen blames its plant closing on competition from subsidized Chinese manufacturers. However, Evergreen has also been subsidized in the multiple ways that federal and state governments favor solar power, says the Journal.
- Bay State taxpayers are now stuck with the losses.
- Mr. Patrick says he intends to claw back some of that $58 million, but Evergreen says it does not owe more than $4 million.
- Taxpayers will also be thrilled to know the state is so worried about getting a new tenant for the manufacturing site that it may let Evergreen keep its sweetheart $1-a-year lease — allowing the company to sublet it at a profit.
All of this adds up to one more case study in the perils of politically allocated capital. Like President Obama, Mr. Patrick has advertised the illusion that governments can nurture new companies, even whole new industries, with targeted taxpayer “investments.” This is the entire premise of the “clean energy” industry, most of which wouldn’t exist without subsidies because it can’t compete on a market basis, says the Journal.
Source: “Solar Power Eclipse,” Wall Street Journal, January 18, 2011.
For text:
http://online.wsj.com/article/SB10001424052748703959104576081991727353356.html?mod=googlenews_wsj
gee what a shock, no green energy is not ready and will cost more for a long time.
I totally agree if your point is government complacency. That would go for all subsidies for all industries including oil and coal. Politicians like to dole out funds with no oversight. The scammers just line up with their hands out. We play politics rather than trying to make something actually work. We argue new over traditional when the fight is really over market share between Chevron and GE. We end up being their pawns in a completely different fight.
Solar works. That’s the bottom line. It has it’s place in meeting our future power needs. Oil will only go up in price while solar will be constant. The problem is only in the start up. That will take government money if it’s going to happen. Once it’s here it will first become self sustaining, then it will become profitable. Like Bolder dam with it’s government subsidies. It’s paid for and still working. We’re better off for it in spite of the name change. It’s only politics.
WSJ, Murdoch owned. I quit giving them much creditability.