Business Gov’t-Backed ‘Clean’ Energy Company Cancels IPO
- Posted on April 16, 2012 at 11:47am by Becket Adams
Last week, BrightSource Energy, a “green” energy company, canceled its initial public offering (IPO), admitting that there is no market for its stock. Of course, this sort of failure probably wasn’t what the Department of Energy (DOE) had in mind back when it decided to award BrightSource a $1.6 billion loan guarantee for its Ivanpah plant in California.
“Not too long ago, the prospects for BrightSource seemed so limitless that the company incorporated the word into its logol,” the New York Times’ Diane Cardwell writes. “It had raised tens of millions of dollars from leading venture capitalists, struck partnerships with corporations like Google, Siemens and NRG Energy.”
“Supported by state policy that encouraged utilities to buy lots of solar power, BrightSource had also signed long-term deals to sell much of its planned electricity output to two large utilities,” she adds.
But then something happened: BrightSource (like Ener1, Energy Conversion Devices, Solyndra, Solar Trust, Mountain Plaza Inc., Fisker Auto, etc.) discovered that there isn’t much of a market for renewable energy. Well, not when you’re dealing with competition from the natural gas market and you’re being undercut in the renewable industry by foreign competition.
“The continued market and economic volatility are not optimal conditions for an I.P.O.,” John Woolard, BrightSource’s chief executive, said in a statement.
One could probably say BrightSource’s IPO failure is simply par for the course as far as “green” energy investments made by the DOE are concerned.
It’s no secret that the “clean” energy industry is struggling. As mentioned earlier on The Blaze, the renewable industry’s failure to produce results despite generous — and ethically questionable — support from the Department of Energy has become something of a scandal in the past few years (think Solyndra).
Let’s see (via the Washington Free Beacon):
BrightSource received a $1.6 billion loan guarantee from the Department of Energy, funds that were allocated in the $787 billion stimulus package passed in 2009.
The largest investor in Brightsource (with a 25 percent stake) is VantagePoint Venture Partners, a firm whose principal, Sanjay Wagle, helped raised millions for President Obama’s campaign in 2008 and even served as a “renewable energy grants adviser” at the DOE.
Senate Majority Leader Harry Reid (D., Nev.) is an avid supporter of the BrightSource, and the company’s executives have in turn given thousands of dollars to Reid over the past few years, even hosting a fundraiser for Reid at the BrightSource headquarters in Oakland, Calif.
If nothing else, we can certainly say BrightSource is well-connected.