Solar Panel Company Declares Bankruptcy
MELISSA BLOCK, Host:
In May of last year, President Obama went to Silicon Valley to visit Solyndra, a solar panel maker. It was part of the president's push for green jobs.
BARACK OBAMA: The future is here. We're poised to transform the ways we power our homes and our cars and our businesses.
BLOCK: George Avalos is a business reporter with the Bay Area Newsgroup and he's been covering the Solyndra story. George, welcome to the program.
GEORGE AVALOS: Thanks for having me on. I appreciate it.
BLOCK: Now, Solyndra says it will be seeking Chapter 11 bankruptcy protection. Walk us through what happened here. Why did this company go under?
AVALOS: When Solyndra initially began to ramp up manufacturing, costs were approximately five times as great as competitors. Even within recent months, analysts estimated that at best, Solyndra was still twice to three times more expensive for their modules than competitors in China and the United States.
BLOCK: The $535 million in loan guarantees came from the Energy Department. That had drawn scrutiny before, both from Republicans in Congress, and also from auditors with the Government Accountability Office. They said this deal wasn't properly vetted.
AVALOS: And now it's caused sort of a negative sort of outlook for the industry, but as well as for just how financially sound was it to provide so much money to a company that had never made money. There was never a point where it looked like they were going to make money, at least in the near future.
BLOCK: A spokesman for the Energy Department said, after this news came out: We can't stop investing in game changing technologies. You do wonder if Solyndra's failure illustrates a broader problem for the solar industry. Or is it really unique to this one company?
AVALOS: So there's some success stories but there are also other companies that have recently gone bankrupt. So, there is some real questions as to just how wise these investments are.
BLOCK: George Avalos, a business reporter with the Bay Area Newsgroup. George, thanks very much.
AVALOS: Thank you for having me on. I appreciate it
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