The Rising Influence of Rising Affluence

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BE > Bloom Energy’s 'Tangled Web'

https://townhall.com/columnists/pauldriessen/2018/09/22/bloom-energys-tangled-web-n2521444

Prior to going public, a competitor’s CEO said he hoped the oft-delayed IPO would happen because it would force Bloom to “dial back their practice of playing very loose with the truth.” He meant the Securities and Exchange Commission would be watching, to protect the public. He proved prophetic.

Bloom also claims its “green” electricity costs 9-11 cents per kilowatt-hour (kWh), close to what its competitors charge. But Bloom’s promoted rates come after it receives federal, state and sometimes county subsidies. Absent these, Bloom’s rates would be 25-30 cents a kWh, making it seriously uncompetitive. Even its IPO statements admit a critical dependence on subsidies.

Bloom claims “greenness,” but the USEPA says its fuel cells produce hazardous materials in the filters needed to “scrub” impurities from the natural gas. While acknowledging the hazmats, Bloom claims it is somehow exempt from being labeled a “hazmats generator” – which is critical for Bloom’s marketing.

Other deceptions played out in Delaware, where Bloom cut a sweetheart deal involving 30 megawatts of fuel cell generating capacity (75 times Google’s total install) and a virtually free manufacturing facility. Bloom promised 900 jobs, monthly consumer costs of under $1, and 96% operating “up” time. They delivered 277 jobs, $5/month (and rising) electricity costs and 86% “up” time.

The missing jobs triggered a $1.5 million penalty – versus the $12 million that Delaware paid Bloom to locate there and some $200+ million that Bloom has received so far from state ratepayers under its sweetheart deal. The 623 missing Delaware jobs are in India.

In 2013 Bloom was found guilty of hiring Mexican workers for a third of the federal minimum wage and paying them in pesos. It also violated overtime and record-keeping provisions.

These ethics violations and operational deceptions highlight bigger questions. Can a company actually thrive or even survive if it has lost $2+ billion, has annual interest expenses exceeding $100 million, and produces a product that exists only because of multiple subsidies? Can the company be kept on life support and “media spin” long enough for insider investors to cash out?