Once-Promising Evergreen Solar Goes Bankrupt
BOSTON — Evergreen Solar Inc., the once-promising company that took tens of millions of dollars in incentives from state government, is bankrupt.
The Marlborough company is filing for Chapter 11 and plans to cut 65 jobs in Europe and Massachusetts, on top of the 800 it eliminated earlier this year by closing its plant in Devens.
The bankruptcy filing could complicate the state’s efforts to recover some of the money it gave Evergreen.
WBUR’s business and technology reporter Curt Nickisch has been following the story and joined Morning Edition Tuesday.
Deborah Becker: Why is Evergreen Solar filing for bankruptcy?
Curt Nickisch: The company owes about a half-billion dollars and operations are essentially on hold right now. Evergreen is selling only solar panels that it has in stock, it’s not making any new ones currently. So the company is in deep trouble, and reorganization through bankruptcy seems to be the only way to survive anymore.
One of its major creditors is the state of Massachusetts. Will the state be able to get back what it says it’s owed from Evergreen?
A spokesperson for the state’s economic development office says yes. And of course what’s at stake here is that wonderful and regrettable word “clawbacks.” Evergreen Solar got tax incentives for building a manufacturing plant to create jobs, and since it didn’t create and keep those jobs, it has to give money back. State officials say they were expecting bankruptcy, that they’re going to move aggressively, and they say it will not prevent them from clawing back money.
Where did Evergreen Solar go wrong?
One thing this bankruptcy filing should erase once and for all is this lingering notion that somehow Evergreen’s managers were out to fleece state taxpayers. The fact is they built a factory that got crushed by the law of supply and demand and that really pushed them into bankruptcy.
I spoke with one of the workers who lost his job at Evergreen this year, Andrew Koenigsberg, and he said when solar panel prices crashed worldwide, basically Evergreen was losing money on every panel it made.
Could they have been better managed? From my perspective and from the perspective of a lot of people I knew who worked there, yes they could’ve been better managed. However…I don’t think it would’ve changed the outcome.
If Evergreen can emerge from bankruptcy, is there a chance that it might succeed?
If it does — and it will be tough — it will be because of what excited so many people about the company in the first place: the technology it has to make silicon wafers cheaper. Evergreen Solar can still do that.
Looking back, maybe the biggest mistake it made was trying to build and market and sell solar panels that were made from those cheaper wafers. It’s like if you’re able to build a computer screen cheaper and you decide to go ahead and build the whole computer. If someone comes along and decides to make that computer cheaper, even though you can make the screen cheaper you can’t compete. And that may have been Evergreen’s biggest mistake.
What does the Evergreen Solar story say about the climate for manufacturing and the climate for green business in Massachusetts?
It’s definitely sad to look at the 130 or so people left at Evergreen and know that 65 are now losing their jobs. If Evergreen survives, it may be only as a small company based in Massachusetts with a proprietary technology to make wafers that it will produce at a highly automated and subsidized factory in China. This is so different from the days of Digital Equipment Corp. and Wang Laboratories, when not only great computers were imagined and designed in Massachusetts, we had thousands of people here making them, too.
I think Evergreen shows how different it is now for Massachusetts to both come up with the next big thing and build it.