Bankruptcy Ends World’s Largest Solar Power Development

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Blythe Solar Power groundbreaking. Credit: whitehouse.gov

 

The Blythe Solar Power Project near Blythe, CA was supposed to be the biggest solar power plant ever, at a massive 1 GW. But Solar Trust, who holds the rights to build the plant, filed bankruptcy last week after their parent corporation, Solar Millennium AG of Germany, did the same. Further complicating matters, Solar Trust is the recipient of a $2.1 billion dollar conditional loan guarantee from the Department of Energy, their second largest ever loan. You bet this is going to get political, especially in the aftermath of the Solyndra bankruptcy.

It was less than a year ago that California Governor Jerry Brown and Secretary of the Interior Ken Salazar dedicated the Blythe plant, promising thousands of new jobs and enough power for 700,000 homes. But in the intervening time, the solar industry has faced withering internal competition, primarily from China, and governments are getting nervous and pulling funding and tax credits.

This does not bode well for California, Arizona, Nevada, and other states that are ramping up solar development. California has mandated 33% renewable energy by 2020 and every gigawatt is important. Some remain optimistic that the plant will be sold and construction will continue.  Blythe City Manager David Lane says “It’s a little blip… when you consider the amount of investment in the project and what it’s got going for it.” Perhaps, but buyers may be scarce in a post-Solyndra world since renewable energy projects are now being scrutinized intently not just by business but by politicians too.

That federal loan guarantee is already being scrutinized. NextEra Energy Resources has provided a $22.3 million credit facility for Solar Trust at steep rates. The often snarky and even more accurate Zero Hedge opines this could be a lead-in to NextEra  buying Solar Trust for pennies on the dollar, and isn’t that just yet another fine show of crony capitalism? Will debts owed by Solar Trust be paid off by the government, which means by us, the taxpayers?  This is something any potential buyer of Solar Trust would certainly benefit from.

We need better oversight of federal energy loans and guarantees. Plus, government needs to be first in line to claim assets in event of a bankruptcy. That’s not what we have now.

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  1. Christina Cross-Bays Why are these efforts failing? We need this form of energy to move forward? Who's sabotaging it? Come one now people, we need to work together. If Facebook can be worth billions why can't a real tangible industry survive.
  2. Bob Morris The Blythe was planned to be Concentrated Solar Power, which reflects sun from mirrors to a central tower to power turbines. The plunging cost of photovoltaic solar has hurt CSP considerably. Plus, many tax credits for renewables have expired or will expire here. The US talks a good game on renewable energy but has no coherent national plan, plus the plan is always changing.
  3. Kathy Jones Just one more thing if the goverment does contracts by law they are suppose to ensure we the taxpayers get what we can first. WHO ever keeps doing these contracts where the investor gets paid first needs to be fired. It's a rip off and to easy to pour money into a project that would never work if their going to continue to use our funds but someone on the side with little investment gets the pay out
  4. Kathy Jones I live not to far from a solar farm, and I am hearing it's getting ready to fold also
  5. Kathy Jones Today they also announced the HSR project in California will be investigated due to conflict of interest.
  6. Stacy Alexander Dill Long-term: Good as an ever more significant supplement to assist in energy conservation. Short-term: Especially due to its storage issues and its inability to do well in hotter climates (!) very poor. We need to enhance our supplies of existing reliable energy: Coal, Oil and natural gas, nuclear...
  7. Bob Morris Absolutely. The government need to get its money back first. The the private investors.
7 comments
Christina Cross-Bays
Christina Cross-Bays

Why are these efforts failing? We need this form of energy to move forward? Who's sabotaging it? Come one now people, we need to work together. If Facebook can be worth billions why can't a real tangible industry survive.

Bob Morris
Bob Morris

The Blythe was planned to be Concentrated Solar Power, which reflects sun from mirrors to a central tower to power turbines. The plunging cost of photovoltaic solar has hurt CSP considerably. Plus, many tax credits for renewables have expired or will expire here.

The US talks a good game on renewable energy but has no coherent national plan, plus the plan is always changing.

Kathy Jones
Kathy Jones

Just one more thing if the goverment does contracts by law they are suppose to ensure we the taxpayers get what we can first. WHO ever keeps doing these contracts where the investor gets paid first needs to be fired. It's a rip off and to easy to pour money into a project that would never work if their going to continue to use our funds but someone on the side with little investment gets the pay out

Kathy Jones
Kathy Jones

I live not to far from a solar farm, and I am hearing it's getting ready to fold also

Kathy Jones
Kathy Jones

Today they also announced the HSR project in California will be investigated due to conflict of interest.

Stacy Alexander Dill
Stacy Alexander Dill

Long-term: Good as an ever more significant supplement to assist in energy conservation. Short-term: Especially due to its storage issues and its inability to do well in hotter climates (!) very poor. We need to enhance our supplies of existing reliable energy: Coal, Oil and natural gas, nuclear...

Bob Morris
Bob Morris

Absolutely. The government need to get its money back first. The the private investors.