Wednesday, a solar cell manufacturing company Solyndra announced it would seek Chapter 11 bankruptcy protection. The California-based solar company, after struggling to compete with larger rivals and low-priced solar cells flooding from China, will lay off all of its 1,100 workers and close down the factory in Fremont, which was built through the fed's loan guarantee.
We are incredibly proud of our employees, and we would like to thank our investors, channel partners, customers and suppliers for the years of support that allowed us to bring our innovative technology to market, Solyndra's Chief Executive Officer Brian Harrison said in a news release. This was an unexpected outcome and is most unfortunate.
Found in 2005, Solyndra designs, manufactures and sells solar photovoltaic systems, comprised of panels and mounts, for the commercial rooftop market, and has installed its solar systems on over 1,000 rooftops in more than 200 countries.
Solyndra was one of the most well-funded startups ever, raising over $1 billion. According to the company website, it was named One of the 50 Most Innovative Companies in the World by MIT's Technology Review Magazine in 2010.
In 2009 spring, the solar panel maker was awarded with $535 million loan guarantee by the Department of Energy. With the fund, the firm built its second factory in Fremont, which President Barack Obama and former Governor Arnold Schwarzenegger praised as a symbol of America's economic recovery and commitment to a green economy.
Over the last six months, Solyndra executives, lobbyists, and investors, as well as officials at the DOE and OMB repeatedly told Committee investigators that Solyndra was financially sound, says a press release by House Energy and Commerce Committee on Wednesday.
The loan has been investigated by Energy and Commerce Committee which deemed the investment dubious, and inssued a subpoena in July. OMB agreed to produce all documents necessary to the Committee's investigation in August, with appropriate safeguards relating to proprietary information.
Solyndra's bankruptcy reveals the failure of Obama administration's energy program, which promoted the loan guarantee, whose first recipient was a startup company in the solar industry - Solyndra.
This is really bad news.... Half a billion dollars of taxpayer money and we may end up holding the bag, House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) told ABC News. This is just a classic case of fraud and abuse and waste.
The Solyndra Effect, one clean-tech investor said, now refers to the chill sent down the spines of potential limited partners of venture capital funds by the massive writedowns experienced by investors in the solar company, reports The Wall Street Journal.
Solyndra will be the third solar company to file bankruptcy protection in August, following Spectrawatt Inc. and Evergreen Solar Inc.