Mass. hands out $58 million in aid to solar company, now leaving state

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In a blow to state officials hoping to make Massachusetts a hub of clean-energy manufacturing, solar panel maker Evergreen Solar, Inc. announced Wednesday that it will shut its operation in Devin, and fire all 800 workers. The company’s 450,000-square-foot manufacturing plant has been operational only since 2008.

Governor Deval Patrick led the controversial effort to lure Evergreen’s stateside operation to  Massachusetts, providing the company with aid and subsidies worth $58 million, one of the largest ever handed out to a private enterprise.

The company’s chief executive, Michael El-Hillow, said that the local cost structure was too high compared to China, at a time when the selling price of solar panels is dropping steadily. “During the month of December, we experienced a 10 percent decrease in average selling prices from the beginning of the fourth quarter. As industry selling prices continue their rapid declines into 2011, panel manufacturing in Devens, either fully or partially, is no longer economically feasible, consequently requiring a complete shutdown of the facility.”

The company said that it will continue to have its headquarters in the state, but move all of its U.S. manufacturing work to its plant in Michigan, where it said costs are lower and the state has provided them with $5.7 million in tax incentives. The bulk of the company’s development and production activities will continue to take place in Wuhan, China.

The state says that not all the money is wasted, having invested about $13 million in infrastructure such as roads and utilities, which can be used by other companies looking to operate in the former army base in which Evergreen had located.

Even though state officials said there are claw-back provisions enabling it to recapture some of the monies it gave to Evergreen, the company said that it expects to have to pay back only $3 million to $4 million, less than 10 cents on the dollar.

One lawmaker, Democrat Sen. James B. Eldridge, is pushing the state to take more action against companies that don’t follow through on their promise to provide jobs after taking big aid packages. “I really hope the Legislature takes a hard look at these tax-break strategies for big corporations,” he said.

The Boston Globe

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