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Electric cars might not carry the day for A123

The Waltham company recently cut its revenue forecast for 2011 by about 20 percent and laid off a few hundred employees at its Michigan factory after one of its biggest customers, electric-car maker Fisker Automotive, was cut off from hundreds of millions in federal funds because it failed to meet the terms of its government loan. A123’s troubles are emblematic of the struggle of the nascent clean technology industry, which currently relies heavily on government subsidies as it labors away at developing commercially viable products

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Comments

A123 got $249 million in stimulus, $100 million economic incentives from Michigan, and a $5 million dollar forgivable loan from the Mass Clean Energy Center. It shouldn't be "unexpectedly" that Fisker reduced the number of batteries on order with A123. Dec. 29 (Bloomberg) -- Fisker Automotive Inc., which is beginning to sell plug-in electric sports cars, said it is recalling 239 Karma cars in the U.S. because of a battery defect supplier A123 Systems Inc. announced last week. http://www.businessweek.com/news/2012-01-02/fisker-recalls-karmas-after-a123-reports-battery-defect.html Mass Green bubbles are bursting and/or heading to China. Evergreen Solar, Beacon Power, Boston Power, etc., are the harbingers. The Patrick Administration Energy Secretary recently boasted about the success of MA renewable firms. This skewed view compromises citizens' right to the unvarnished truth about the status of our 60% investments Mass green bubbles. Thanks to the Boston Globe today, we have a more accurate picture of the viability of A123.

Thanks for the article. Here's another take. Massachusetts should be investing much, much more in green technologies and green transportation initiatives. The long term benefits to our economy and our health depend on it. It won't happen when you have entrenched special interests working against common sense. Electric cars are a disruptive technology. Disruptive technologies, while offering many public benefits, are difficult to implement without support from the public sector, due to the overwhelming development and deployment costs. We don't have to just subsidize electric cars but we have to support alternative forms of clean power like wind and solar. One factor you don't see advertised enough is the effect of externalities. Paul Epstein, director of Harvard Medical School Center for Health and the Global Environment, has examined the health and environmental impacts of coal, including: mining, transportation, combustion in power plants and the impact of coal's waste stream. He found that the "life cycle effects of coal and its waste cost the American public $333 billion to over $500 billion dollars annually". These are costs the coal industry is not paying and which fall to the community in general. Eliminating that subsidy would dramatically increase the price of coal-fired electricity Ultimately, the clean energy sector is unstoppable.