Two weeks ago we introduced you to Abengoa - the Spanish renewable-energy company - that received over $230 million in US taxpayer subsidies and loos set to become Solyndra 2.0. While all the politicians have taken their pound of flesh, Abengoa bonds have collapsed for five days in a row, now trading at record lows around 45 cents on the dollar - flashing the bankruptcy imminent light. Solyndra 2.0?
Abengoa 2020s fell over 5 points today to around 45 cents on the dollar...
As we concluded previously, the company’s political connections are emblematic of an industry that remains reliant on taxpayer subsidies, according to William Yeatman, a senior fellow specializing in energy policy at the Competitive Enterprise Institute.
“It could not be more clear that this company could not survive without access to government favors from political friends,” Yeatman said, citing its reliance on the Renewable Fuels Standard and continued financial support from DOE.
“Alas, the same can be said for the green energy industry as a whole, which would fast wither and die absent a steady diet of taxpayer and ratepayer subsidies,” Yeatman said.
In addition to its DOE subsidies, Abengoa received $185 million in financing in 2012 and 2013 through the U.S. Export-Import bank as former New Mexico Gov. Bill Richardson (D) sat on the boards of both the federal agency and the company it was subsidizing.
Despite extensive federal support for the company, Alhalabi described a culture of disregard for workplace safety and environmental contamination. Concern over high costs has led to lackluster engineering work at the company’s Mojave facility that could result in an “environmental disaster,” he said.
Solyndra 2.0? Another one off? Or another symptom of the Oligrachic ignorance of where the money comes from...It appears US taxpayers can kiss that money goodbye...
“The equity increase gives the impression that the company urgently needs cash,” said Fischer. “They’ve not done enough to win back investors’ trust.”