Beacon Power Corp, of Tyngsboro, Mass, filed for Chapter 11 bankruptcy Sunday. The company listed $72 million in assets, and $47 million in outstanding liabilities.
But unlike Solyndra, the California-based solar power manufacturing firm that declared bankruptcy, laid off 1,000 workers and closed its doors last month after receiving a $530 million federal grant, Beacon reportedly says it wants to stay in business.
In the U.S., electricity is produced as current which alternates at a nominal 60 times a second. But the 60 Hertz rate can be effected by how much load is places on the system. Too much load and the rate decreases; reduce the load and the rate increases. The result is less efficient, and sometimes harmful operation of equipment using the electricity. About one percent of the energy from a coal-fired generator is spent trying to stabilize those fluctuations.
Beacon was set to build an array of flywheels in a commerce park near Hazleton, Pa., similar to two other arrays the company operates. The flywheels act to stabilize electrical current on “the grid,” as the electricity transmission system is known.
A flywheel is a heavy wheel powered by the same electricity. When the alternating rate increases, the wheel absorb the excess energy. When demand is high, loading down the system, the flywheel releases energy into the grid.
According to a Beacon Power statement issued in August, the company recently began operating a similar system in Stephentown, N.Y. It also operates a system in Tyngsboro, Mass.,and was to begin construction later this year on a 20-megawatt flywheel system on a 5.5-acre site in Humboldt Industrial Park in Hazle Township.
“We’re very pleased to receive news of this $5-million grant commitment for our next 20 megawatt energy storage plant,” Bill Capp, Beacon Power president and CEO said in the statement. “We’re grateful for the collaborative, bipartisan effort that helped finalize this grant, especially to Governor Corbett, Congressman Barletta, State Senator John Yudichak, State Representative Tarah Toohil, the Pennsylvania Public Utility Commission, and Bernadette DeBias and Joseph Lettiere of CAN DO, Inc. We look forward to the start of construction later this year.”
The $53 million project was to be partially funded by a $24 million U.S. Department of Energy Smart Grid stimulus grant. and a $5 million grant from the Pennsylvania Redevelopment Assistance Capital Program.
Earlier this month, the company was told by The Nasdaq Stock Market is risked being dropped from the Nasdaq Capital Market. The bid price of its stock had been listed, for the previous 30 consecutive business days, below the minimum $1 per share Nasdaq requirement.
Wisconsin GOP Rep. Jim Sensenbrenner, vice chair of the U.S. House Committee on Science, reportedly announced plans to introduce legislation to require independent audits of all DOE loan guarantees. The Obama administration has ordered an independent review of the guarantees.
Beacon said its current financial woes result from capital-intensive building, and that the company’s long-term financial prospects are strong.
Photo by Beacon Power Corp
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