Yet Another Green Energy “Success Story”

Seems the more you look, the more “good news” you find regarding our current Administration’s picking of “green energy” winners and losers.

Like folks playing cards, board games, and helping out at local charities on the company dime.

Well, sorta on the company dime.  Seems many of those dimes were actually provided by Uncle Sam.

LG Chem, a South Korean company, decided to build a battery factory in Holland, Michigan.  They got a $151 million grant from the DoE under the Recovery Act.

The plant cost around $300 million.  And about $133 million of the grant money has been spent – much, rather understandably, going to other South Korean businesses.  Hey, LG Chem is a Korean company; who would you expect them to buy some of their equipment from?

Still, that’s just normal business.  And I guess I could live with that – if the factory was actually producing anything.

Unlike some “green” firms, this factory actually could produce a useable product.  The pilot run for the plant produced battery cells that performed quite well.  The production process was sound, and the resulting battery cells would have been useful and salable.  Everything was “good to go” for start-up.

But the factory has yet to ship a single battery to a customer.  Seems it was built to produce battery cells for use in the Chevy Volt.

Oops.

Approximately 100 of the factory’s employees are assessed to be funded by Federal grant money.  Today they – and their colleagues – are doing nothing useful.

Management had (and has) them doing “make work” jobs – cleaning inside and outside, studying, etc. . . . When there’s no work for them to be assigned, they do nothing – or play cards and board games.  In fact, it got so boring many asked for permission to help out at local charities like Habitat for Humanity on company time.

In September, they started 1 week in 4 furloughs – though they’ll apparently be eligible to receive Michigan Unemployment Compensation (UC) while on unpaid furlough.  And since Michigan is one of those states that has already exhausted it’s UC fund balance, that means the Federal government will also be paying for those UC benefits, too – at least in the short run.

None of this is the employees’ fault.  And I can’t really fault LG Chem, either.  They thought they could produce a good product, would get a good economic deal to do so, get a good return on investment, and could also help the local economy.  It just didn’t work out.

But I do wonder whether they’d have done this without that $151 million “sweetener” that Uncle Sam gave them.  Or without the foolish assurances they doubtless got that the Chevy Volt would be the US auto industry’s “next big thing”.

Something tells me the answer in both cases is “No”.  And something also tells me that the US taxpayer is out at least $133 million here – and probably more – that they’ll never get back.

Hat tip to UpNorth for the first link above.

Category: Economy