“Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion,” Solyndra's CEO said.
A California-based solar company that received a $535 million loan guarantee from the Obama administration announced Wednesday that it will shut down.
The company, Solyndra Inc., said Wednesday it would suspend its manufacturing operations and lay off 1,100 employees effective immediately. The company said it intends to file a petition for Chapter 11 bankruptcy protection.
“Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion,” Solyndra CEO Brian Harrison said in a statement. “Raising incremental capital in this environment was not possible. This was an unexpected outcome and is most unfortunate.”
But the Obama administration has doubled-down on its investments in the industry. The Energy Department finalized last week an $852 million loan guarantee for a separate California solar project sponsored by NextEra Energy. Earlier in August, DOE finalized a $197 million loan guarantee for solar manufacturing facilities in Oregon and California.
Solyndra received the $535 million stimulus loan guarantee from the Energy Department in 2009 to help finance the construction of a new plant to manufacture solar panels.
The Energy Department said Wednesday that it is “disappointed” that Solyndra is shutting down its manufacturing operations, but added, “We continue to believe the clean energy jobs race is one that America can, must and will win.”
“We have always recognized that not every one of the innovative companies supported by our loans and loan guarantees would succeed, but we can’t stop investing in game-changing technologies that are key to America’s leadership in the global economy,” said Dan Leistikow, director of the office of public affairs, in a blog post Wednesday.
Leistikow called Solyndra a “once very promising company that has increased its sales revenue by 2000 percent in three years and sold more than 1000 installations in 20 countries.”
Republicans have blasted the Obama administration for approving the loan guarantee to the company, which has faced financial hurdles for months.
Solyndra announced last year that it would close a plant, lay off employees and delay the expansion of its newest facility. It also canceled plans to go public.
House Energy and Commerce Committee Republicans launched an investigation into the loan guarantee in February, alleging that the administration didn’t adequately vet the company’s financial situation.
As part of the investigation, Republicans in March requested a slew of documents from the White House Office of Management and Budget (OMB) related to the loan guarantee.
After OMB refused to provide all the documents, Republicans on the House Energy panel’s Oversight and Investigations subcommittee voted in July to issue a subpoena. OMB in August agreed to provide all the requested documents.
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