Tesla

The publicity surrounding President Obama’s failed strategy to stimulate the economy, by putting clueless manager Steven Chu in charge of the Department of Energy’s lending activities, has become so bad that few “green energy economy” entrepreneurs want to accept taxpayer money any more.

That’s according to a report published earlier this month by the Government Accountability Office, which reviewed DOE’s loan programs for a briefing to both the House and Senate’s Appropriations subcommittees on Energy. Amusingly though, the Web site of DOE’s Loan Programs Office still calls itself “The Financing Force Behind America’s Clean Energy Economy.” The minor blip that undermines that premise is that DOE is having trouble getting someone to borrow $55 billion.

Undoubtedly alternative energy and transportation innovator Elon Musk (Flickr photo: Jurvetson) – like his competitor for the taxpayer-funded, six-figure electric automobile market Henrik Fisker – is a smart guy. But will economic and technological realities humble him, or worse, make him look like a fool?

After the experience recounted last week by New York Times journalist John Broder, who test drove the Tesla Model S in frigid conditions that required frequent unplanned recharging stops throughout the Northeast, humility is out of the question for Musk. The jury is still out on inanity.

As Bloomberg reported today, stimulus-funded electric vehicle battery maker A123 Systems filed bankruptcy in federal court after failing to make a debt payment that was due. Milwaukee Business Times has reported that Johnson Controls will purchase the “automotive business assets” of A123 for $125 million, and that A123 will receive from Johnson $72.5 million in “debtor in possession” financing to continue operating during the sale process.

Regular readers won’t be surprised, as the company’s gradual sink to its current depths – despite receiving hundreds of millions of dollars from taxpayers – has been covered by NLPC since late last year. A review:

The electric vehicle fire in Woodside, Calif. about a week ago has led to the third recall in the short life of taxpayer-subsidized ($193 million in stimulus) Fisker Automotive and its plug-in hybrid model, the Karma.

The first two recalls were caused by problems with batteries produced by Fisker’s similarly troubled supplier and business partner, A123 Systems. The company said this time the fire was caused by a failure in a cooling fan, which caused overheating while the vehicle’s owner shopped for groceries inside a store. About 2,400 Karmas – 1,400 of which are in the possession of customers – will need to be recalled.