Fox News is seizing on the bankruptcy of electric car battery manufacturer A123 Systems to reinforce Mitt Romney's blatantly false claim that "about half" of the Obama administration's clean energy investments have gone to bankrupt companies. But only about 6 percent of the loan guarantees that Romney referred to went to companies that have gone bankrupt, and A123's announcement makes it only the second to declare bankruptcy out of 29 companies that have received grants under a separate clean energy program.
Shortly after A123 Systems declared bankruptcy this morning, Fox's Stuart Varney labeled it "another green energy bust," comparing it to Solyndra. Noting that the company has used about half of its $249 million grant from the Department of Energy, Varney said: "Only half of it, but that is lost money."
But Varney and a later Fox News report neglected to mention that A123 plans to sell its assets -- including its technology and manufacturing facilities -- to Johnson Controls, a leading auto industry supplier. The Department of Energy noted that A123 has "obtained bridge financing from Johnson Controls," so the U.S. battery manufacturing facilities are expected to continue operations.
Nevertheless, Fox is using the news to revive Romney's attacks on the Obama administration's clean energy investments, airing his debunked claim during the first presidential debate that Obama gave $90 billion to green energy companies, half of which went bankrupt. In fact, that $90 billion includes funding for energy efficiency programs, electric grid modernization, high-speed rail and even "clean coal" research. And of the 26 recipients of Department of Energy 1705 loan guarantees, only three have filed for bankruptcy, amounting to about 6 percentof the loan guarantee funds. Congress budgeted for losses under the program, knowing that not every company would succeed.
Likewise, of the 29 companies that received grants under DOE's Electric Drive Vehicle Battery and Component Manufacturing Initiative, A123 is only the second to declare bankruptcy.
Investments in alternative vehicles previously received bipartisan support, even from some at Fox News. But in recent years, Fox has jumped on every opportunity to mislead the public about electric cars, even if it means mocking American companies.
You can expect to see a lot of conservative media dancing on A123's grave this week, but you will probably hear less about how the program that invested in A123 has led to huge cost breakthroughs, according to the Department of Energy:
Prior to this investment, a battery with a 100 mile range cost $33,000. Because of technology improvements and the high volume manufacturing capability we have today, the estimated cost is down to about $17,000 and is expected to drop to $10,000 by 2015.