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Getbig Main Boards => Politics and Political Issues Board => Topic started by: Soul Crusher on July 05, 2012, 02:24:35 PM
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http://www.washingtontimes.com/news/2012/jul/4/lights-go-dim-on-another-energy-project
Another 100 million down the drain.
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Lights go dim on another energy project
Geothermal losses pile up
By Chuck Neubauer
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The Washington Times
Wednesday, July 4, 2012
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A geothermal energy company with a $98.5 million loan guarantee from the Obama administration for an alternative energy project in Nevada — which received hearty endorsements from Energy Secretary Steven Chu and Senate Majority Leader Harry Reid — faces financial problems, and the company’s auditors have questioned whether it can stay in business.
Much like Solyndra LLC, a California solar-panel manufacturer with a $535 million federal loan guarantee that went bankrupt, Nevada Geothermal Power (NGP) has incurred $98 million in net losses over the past several years, has substantial debts and does not generate enough cash from its current operations after debt-service costs, an internal audit said.
“The company’s ability to continue as a going concern is dependent on its available cash and its ability to continue to raise funds to support corporate operations and the development of other properties,” NGP auditors said in a financial statement for the period ending March 31.
“Consequently, material uncertainties exist which cast significant doubt upon the company’s ability to continue as a going concern,” the statement said.
Mr. Reid, a Nevada Democrat who led passage of the $814 billion stimulus bill and worked to include the loan guarantee program to help finance clean-energy projects, predicted in 2010 that NGP would “put Nevadans to work” and declared that Nevada was the “Saudi Arabia of geothermal energy.”
Mr. Chu celebrated NGP’s potential in his June 2010 announcement of the loan guarantee, saying the federal government’s support of the company demonstrated its commitment to geothermal power to achieve the nation’s clean-energy goals.
But Rep. Jim Jordan, Ohio Republican and chairman of the House Oversight and Government Reform subcommittee on regulatory affairs, stimulus oversight and government spending, is concerned about NGP’s finances and the timing of the loan guarantee.
“The company was in danger of defaulting on its financial obligation, and the [Department of Energy‘s] assistance served as a de facto bailout,” Mr. Jordan said. “After receiving a taxpayer-backed $98.5 million loan guarantee, the company is still struggling.”
He said the loan guarantee “essentially served to prop up an already-faltering firm.”
In January, Rep. Darrell E. Issa, California Republican andchairman of the House Oversight and Government Reform Committee, told Mr. Chu that the NGP loan guarantee raised questions about why the Energy Department was investing significant taxpayer resources in a company with well-established financial problems.
‘Save the failing company’
At the time the Energy Department announced its conditional approval of the guarantee, Mr. Issa said NGP would have defaulted on a loan from TCW Asset Management Co., then its primary lender, “had DOE not swooped in to save the failing company with taxpayer money.”
A committee report said the loan did not finance any new construction and “did not help to create a single job.”
During a House hearing in May, Rep. Frank C. Guinta, New Hampshire Republican, asked why NGP needed a government loan in 2010 just a year after it had received financing to get its plant up and running. He said it didn’t sound like a loan but a bailout.
“I don’t see it’s a good practice for the Department of Energy to use taxpayer-subsidized loans to provide to an entity that already has an existing facility,” he said.
Story Continues →
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Lights go dim on another energy project
Geothermal losses pile up
By Chuck Neubauer
-
The Washington Times
Wednesday, July 4, 2012
Yes
No
Undecided
Other
Login to Vote
View results
A geothermal energy company with a $98.5 million loan guarantee from the Obama administration for an alternative energy project in Nevada — which received hearty endorsements from Energy Secretary Steven Chu and Senate Majority Leader Harry Reid — faces financial problems, and the company’s auditors have questioned whether it can stay in business.
Much like Solyndra LLC, a California solar-panel manufacturer with a $535 million federal loan guarantee that went bankrupt, Nevada Geothermal Power (NGP) has incurred $98 million in net losses over the past several years, has substantial debts and does not generate enough cash from its current operations after debt-service costs, an internal audit said.
“The company’s ability to continue as a going concern is dependent on its available cash and its ability to continue to raise funds to support corporate operations and the development of other properties,” NGP auditors said in a financial statement for the period ending March 31.
“Consequently, material uncertainties exist which cast significant doubt upon the company’s ability to continue as a going concern,” the statement said.
Mr. Reid, a Nevada Democrat who led passage of the $814 billion stimulus bill and worked to include the loan guarantee program to help finance clean-energy projects, predicted in 2010 that NGP would “put Nevadans to work” and declared that Nevada was the “Saudi Arabia of geothermal energy.”
Mr. Chu celebrated NGP’s potential in his June 2010 announcement of the loan guarantee, saying the federal government’s support of the company demonstrated its commitment to geothermal power to achieve the nation’s clean-energy goals.
But Rep. Jim Jordan, Ohio Republican and chairman of the House Oversight and Government Reform subcommittee on regulatory affairs, stimulus oversight and government spending, is concerned about NGP’s finances and the timing of the loan guarantee.
“The company was in danger of defaulting on its financial obligation, and the [Department of Energy‘s] assistance served as a de facto bailout,” Mr. Jordan said. “After receiving a taxpayer-backed $98.5 million loan guarantee, the company is still struggling.”
He said the loan guarantee “essentially served to prop up an already-faltering firm.”
In January, Rep. Darrell E. Issa, California Republican andchairman of the House Oversight and Government Reform Committee, told Mr. Chu that the NGP loan guarantee raised questions about why the Energy Department was investing significant taxpayer resources in a company with well-established financial problems.
‘Save the failing company’
At the time the Energy Department announced its conditional approval of the guarantee, Mr. Issa said NGP would have defaulted on a loan from TCW Asset Management Co., then its primary lender, “had DOE not swooped in to save the failing company with taxpayer money.”
A committee report said the loan did not finance any new construction and “did not help to create a single job.”
During a House hearing in May, Rep. Frank C. Guinta, New Hampshire Republican, asked why NGP needed a government loan in 2010 just a year after it had received financing to get its plant up and running. He said it didn’t sound like a loan but a bailout.
“I don’t see it’s a good practice for the Department of Energy to use taxpayer-subsidized loans to provide to an entity that already has an existing facility,” he said.
Story Continues →
It hasn't filed for bankruptcy you moron...the shareholder's meeting is for July 24th over some business concerns...no different than a lot of business...whether its a green energy company or a 5 and Dime store.
As far as its backing is concerned...it was bipartisan as its a geothermal company which isn't something brand new. More than likely it has to deal with foreclosures causing them to lose customers
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Yes, and home foreclosures are also to blame for Solyndra going under. ::)
Seriously, where do you morons come up with this garbage?
I think that half of you would rather have sex with a dead goat or watch a loved one get eaten alive by rats than admit Obama has made a single stupid or dishonest decision as President.
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Yes, and home foreclosures are also to blame for Solyndra going under. ::)
Seriously, where do you morons come up with this garbage?
I think that half of you would rather have sex with a dead goat or watch a loved one get eaten alive by rats than admit Obama has made a single stupid or dishonest decision as President.
Solyndra was dealing with solar whereas this company dealt with geothermal power....they are generating enough to power 3000 homes....the problem is that there isn't 3000 homes
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Solyndra was dealing with solar whereas this company dealt with geothermal power....they are generating enough to power 3000 homes....the problem is that there isn't 3000 homes
LOL Vince I think that you miss the unintentional irony and comedy in your statement.
Epic planning and fiscal responsibility.
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LOL Vince I think that you miss the unintentional irony and comedy in your statement.
Epic planning and fiscal responsibility.
Geothermal energy isn't something that you can really measure or control like solar energy. It gives off an unmeasured amount of electricity and the number of employees needed to operate it is only 25
I hope this company solves its issues because we really need to cut our dependence on foreign oil