Ener1 Files for Bankruptcy
Ener1, the parent company of EnerDel, an electric car battery manufacturer that received a $118 million grant from the Obama administration has filed for bankruptcy protection.
Alex Sorokin, the CEO for Ener1, said the company suffered when demand for the batteries dropped as fewer Americans than expected opted for electric cars. "This was a difficult, but necessary, decision for our company," Sorokin said. "We moved aggressively to reduce costs and shift focus when the marketplace did not evolve as quickly as anticipated. Our business plan was impacted when demand for lithium-ion batteries slowed due to lower-than-expected adoption for electric passenger vehicles."
Ener1 said that the bankruptcy filing and newly announced company restructuring would allow its subsidiaries, including EnerDel, to "continue normal operation."
The filing came exactly a year after Vice President Joe Biden visited an Ener1 manufacturing plant in Indiana. "A year and a half ago, this administration made a judgment. We decided it’s not sufficient to create new jobs -- we have to create whole new industries," Biden told the plant workers then. "We’re back in the game."
Ener1 is the third 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.
Solyndra 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 Barack Obama and a rallying cry for GOP critics of the administration’s green energy program.