(Reuters) – Beacon Power Corp filed for bankruptcy on Sunday just a year after the energy storage company received a $43 million loan guarantee from a controversial U.S. Department of Energy program.
The move comes about two months after solar panel maker Solyndra also filed for bankruptcy, setting off criticism of the government loan program.
The department guaranteed $535 million in loans to Solyndra, and Congress is investigating whether political influence played a role.
Beacon Power used the government-guaranteed-loan to build a 20-megawatt flywheel energy storage plant in Stephentown, New York.
The company said in documents filed with Delaware’s bankruptcy court that it had $72 million in assets and $47 million in debts.
The case is Beacon Power Corp, U.S. Bankruptcy Court, District of Delaware, No. 11-13450.
(Reporting by Tom Hals in Wilmington, Delaware; Editing by Dale Hudson)
Beacon Power is a global leader in the development and commercialization of flywheel-based energy storage solutions for grid-scale frequency regulation services and other utility-scale and unitary energy storage applications. Our goal is to use our environmentally sound flywheel technology to deliver superior performance at lower cost, and generate long-term value for our Company, our stakeholders, and society. With today’s urgent need for clean energy solutions that do not burn fossil fuel, Beacon Power is well positioned to provide sustainable solutions for a broad range of energy-balancing applications in multiple global markets.
In 2008, we began the commercial production and deployment of our patented composite flywheel technology for grid-scale frequency regulation. Our primary business model is to be an integrated provider of frequency regulation services by building, owning and operating flywheel-based frequency regulation plants on a merchant basis. We also plan to have co-investors for some of our regulation plants, and to sell some plants outright in parts of the world that lack open bid markets for frequency regulation services.
While our initial market entry application is grid-scale frequency regulation, we are actively exploring other grid-scale and unitary equipment applications for our core technology. We plan to commercialize new applications as our production costs decrease and policy and regulatory reforms create attractive market economics for selected applications.
Beacon Power Corporation was founded in 1997 as a spin-off of SatCon’s Energy Systems Division, to develop advanced flywheel-based energy storage technology. We became a separate operating entity in 1998, and went public in 2000 (Nasdaq: BCON). Our first flywheel systems, the first and second generations of our technology, were deployed in North America for telecommunications backup power applications.
As the telecommunications market slowed, we applied our technology to higher-power applications, leading to the Smart Power and Smart Energy systems. Realizing the synergy between flywheel energy storage and renewable energy, in 2003 we acquired the intellectual property assets of a manufacturer of photovoltaic (solar) power conversion systems. This patented technology was applied first to a line of solar inverters, and today is being incorporated into a “smart grid” technology that Beacon is now developing.
In 2004, after meetings with the U.S. Department of Energy (DOE) and the PJM Interconnection, one of the largest grid operators in the world, we redirected our flywheel R&D program to develop a next-generation system that could “recycle” electricity from the grid, absorbing it when demand dropped and injecting it when demand increased. From 2005-07, we successfully demonstrated third-generation scale-power flywheel systems in New York and California, co-funded respectively by the New York State Energy Research and Development Authority and the California Energy Commission, with DOE support in both cases. Based on that experience and result, we then completed development of the Smart Energy 25, our fourth-generation flywheel system. This flywheel is the basis of our grid-scale Smart Energy Matrix, which is now being commercially deployed for the regulation of grid frequency.
What Others are Saying
As we progress with the deployment of our Smart Energy Matrix™ systems, various officials associated with the projects have expressed support and enthusiasm for the technology’s potential. Here are some of their opinions as captured on video in 2008, as well as thoughts from Beacon’s CEO, Bill Capp.
Secretary, Executive Office of Energy and Environmental Affairs
Commonwealth of Massachusetts
- Why are cleaner methods for frequency regulation so important? – (00:34)
- How can flywheel technology support the deployment of renewable energy? – (00:17)
- Is the grid ready for flywheels? – (00:15)
- What are your impressions of Beacon Power? – (00:10)
Industry Investment and Development Manager
Massachusetts Technology Collaborative
- What is your role at National Grid? – (00:22)
- How can energy storage be of value to National Grid? – (00:32)
- What are your impressions of Beacon Power engineering? – (00:40)
- Are flywheels an efficient way to store energy? – (00:35)
Director of Distributed Resources
- What is your role at National Grid? – (00:18)
- How does National Grid work with state officials to improve the grid? – (00:18)
- What role can energy storage play on the grid? – (00:22)
- What do you think of the work that Beacon Power is doing? – (00:28)
- Why are customer-side grid resources so important? – (00:20)
- What benefits can Beacon’s technology bring to the grid? – (00:32)
President and CEO
- What makes Beacon Power different? – (00:41)
- Is the time right for flywheel energy storage? – (00:24)