Green energy grant recipient goes under

Oct. 17, 2012 at 5:41 PM
share with facebook
share with twitter

WALTHAM, Mass., Oct. 17 (UPI) -- A123, a recipient of federal grant money to jump start the U.S. electric car industry, has filed for bankruptcy, court papers say.

The Waltham, Mass., company, a producer of batteries, was awarded $249 million from the Department of Energy, The New York Times reported Wednesday. The company has only received $132 million of the total and plans to sell itself to battery producer Johnson Controls, but the bankruptcy has the potential to become an issue in the presidential campaign, the newspaper said.

Republican presidential nominee Mitt Romney has been critical of President Barack Obama's initiative to develop an alternatively-powered car industry. In the first presidential debate, Romney scoffed at the $90 billion spent on green energy initiative, saying it could have paid the salaries of 2 million teachers.

Several other companies awarded grants for green energy development have failed, including solar power company Solyndra, which was held up to ridicule in part because Obama had visited its California production facility for a photo opportunity.

The A123 bankruptcy "is yet another failure of the president's disastrous strategy of gambling away billions of taxpayer dollars on a strategy of government-led growth that simply does not work," said Romney's press secretary Andrea Saul in a statement.

Department of Energy spokesman Dan Leistikow said in an online posting the grant money has not been wasted at all, as Johnson Controls intends to buy the business and keep its production facilities going.

"In an emerging industry, it's very common to see some firms consolidate with others as the industry grows and matures," Leistikow said.

Related UPI Stories
Trending Stories