Obama-backed car battery maker goes bankrupt

WASHINGTON - The parent company of an electric car battery maker that received a $118 million grant from the Obama administration filed for Chapter 11 bankruptcy protection on Thursday.

New York-based Ener1 said it has been affected by competition from China and other countries.

Ener1 subsidiary EnerDel received a $118 million stimulus grant from the Energy Department in 2009, and Vice President Joe Biden visited the company's new battery plant in Indiana last year.

CBS News Investigates first reported in October 2011 that Ener1 was facing financial troubles, after NASDAQ pulled the company from its listings, leaving the stock valued at $0.00.

Ener1 is just the latest company to seek bankruptcy protection after receiving assistance from the Energy Department under the economic stimulus law. California solar panel maker Solyndra Inc. and Beacon Power, a Massachusetts energy-storage firm, declared bankruptcy last year. Solyndra received a $528 million federal loan, while Beacon Power got a $43 million loan guarantee.

A CBS News investigation found earlier this month that a dozen green-energy companies - which in total received at least $6.5 billion in stimulus money from the federal government - have filed for bankruptcy protection. (Click on the player at left for a full report on the CBS News investigation)

Solyndra, of Fremont, Calif., was the first renewable-energy company to receive a loan guarantee under the 2009 stimulus law, and the Obama administration frequently touted it as a model for its clean energy program.

Since then, the company's implosion and revelations that the administration hurried a review of the loan in time for a 2009 groundbreaking has become an embarrassment for President Obama and a rallying cry for GOP critics of the administration's green energy program.

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The chairman of a House subcommittee that is investigating Solyndra said the latest bankruptcy showed that the administration's clean energy program has failed.

"Unfortunately, you can now add Ener1 to the growing list of failed companies that went belly up after hundreds of millions of dollars in administration backing," said Rep. Cliff Stearns, R-Fla.

"One bankruptcy may be a fluke, two could be coincidence, but three is a trend," Stearns said. "Our investigation continues, and we are working to ensure taxpayers are never again stuck paying hundreds of millions of dollars because of the administration's risky bets."

An Energy Department spokeswoman said EnerDel had received $55 million so far under a program in which EnerDel matches federal investment dollar-for-dollar. Ener1 said in a statement that the restructuring would not affect EnerDel's operations. The company makes lithium-ion batteries for electric cars such as the Chevrolet Volt.

"While it's unfortunate that Ener1, the parent company, has entered a restructuring process," a recent infusion of $80 million in private investment "demonstrates that the technology has merit," said Jen Stutsman, a spokeswoman for the Energy Department.

"The restructuring is not expected to impact EnerDel's operations and they do not expect to reduce employment at the site" near Indianapolis, Stutsman said.

[mstsc55]

"One bankruptcy may be a fluke, two could be coincidence, but three is a trend," Stearns said. "Our investigation continues, and we are working to ensure taxpayers are never again stuck paying hundreds of millions of dollars because of the administration's risky bets."

Maybe the good representative could actually find some real "skin in the game" by finding what happened to trillion dollars that got dumped into Iraq.

Still waiting on that one...

[MiserableOldFart]

Gee, sure wish they were so gung-ho about the $10 BILLION IN CASH the "other administration" lost in the Middle East.

Seems only one side of the story matters, just like one embassy attack in this administration vs. 12 during dubya's..

[gep1955]

Obama is acting just like a Wall Street hedge fund manager who risk other peoples money on business futures. OH wait, the other people is us and the money is our taxes. This guy is a lying, thieving crook, makes W look like a boyscout. Do any liberals pay taxes? Are they as carefree with their money as Obama is with their money? You should be as enraged as us conservatives.

[puzzler125]

Slant much? "Obama backed?" How about "government backed?"

[sirmarion-2009]

And the Obama Administration wonders why America Tax Payers are against paying more taxes? When does the light come on in His head that Electricity is produced by Coal And fuel oil fired plants,that would be needed to charge those green car batteries,that no one wants?

[bruce789]

We should invest in diesel and coal fired generators since those are what is used to make electricity and charge the car batteries.

[askagain]

This is an example of why taxpayer money should not be used to prop-up or fund companies. Let the markets decide which companies will survive. It is one thing when private companies and individuals risk their capital but taxpayer money should not be at risk.

[Feeduptoo]

You are 100% correct. If the government wants to help start ups with financial support, it should enlist it from special interest sources, the way the GOP auctions itself to the highest bidders.

[ispat101]

Just read on msnbc that CEOs rake in huge sums of money when companies go bankrupt. Someone should check what the CEOs of these companies got paid at exit. By hook or by crook, top executives will always fool people and make money, thanks to the laws and their loopholes.

[Jhihmoac]

...More like "by crook"...

[fedup12]

by Leftwing-Losers January 27, 2012 8:08 PM EST
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Lefty..... Seriously I am more conservative than you are. Especially if you supported W or Reagan.

I just wanted to point out your hypocrisy. Who needs more support a fledgeling technology startup or a near 100 year old industry with record profits.

I actually think we should be out of it but in cases like this Obama is more conservative than W Bush.

Ron Paul 2012.

[fedup12]

an atom in the bucket compared to oil co. subsidy's and tax "incentives" all while they are bringing home record profits.

[fishguru00]

hey fedup, name one tax incentive that the major oil and gas companies get that other companies get... one...

[fedup12]

3.Oil and Gas exploration and development expensing ($7.1 billion)
==================================================

So this little snafu seems like a drop in the bucket.

What is worse is this 1%er welfare is still going on during record profit taking.

ask and receive.

[PourpaixPourpaix]

Geez, my kid's racked up another Mercedes at the ivy league college I sent him to, and I nearly tapped out my last business loan after just a couple years. With as much of it that goes up my nose, I guess we burn through a lot of money every month. We're gonna run out of money soon, yet again, and need to put together another loan app. Anyone have an extra copy of the federal guarantee paperwork? I don't have time for this ..... should just give me the money with a phone call. After all, I'm privileged and shouldn't have to waste all week filling out stupid forms. It's almost like I have to work for it!