Tuesday, February 07, 2012

Hooray for Fraud and Waste

Seen this?

Synopsis: Beacon Power got a $43M Dept. of Energy loan guarantee to develop its concept for spinning flywheels to temporarily store excess electricity and release it when needed (This is a big problem, especially with solar and wind power that are not available 100% of the time; the conventional power plants that are fired up to meet demand peaks are typically the oldest and dirtiest).

Then Beacon Power ran out of money and filed bankruptcy. OMG, another Solyndra! Government meddling in the "free market"! Fraud! Waste!

Except not. Under the new deal, the government will get 70% of its money back. And Beacon Power will live to fight another day, even announcing plans for a second plant. The net of it all is that the government invested $13M to get a promising energy technology launched. And this is bad why?

I was glad to hear Obama caution us in the State Of The Union address that some of the government's investments would fail. Duh. Here's the deal: government may not be the ideal risk-capital investor, but we've got ourselves an emergency here, and if private capital won't step up and shovel money at every energy technology with a reasonable chance at success, then that leaves good old Uncle Sam.

And yes, there could even be some of the dreaded "fraud and waste" involved. Tough: that's the price we pay for letting our energy problems fester since the Carter era, for God's sake.

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