They bit off more than they could chew. The sun may set on the biggest solar conglomerate machine on earth. And it is still growing bigger even as the bubble popped some time ago. Stock has fallen 99% over the last year and is trading at virtual penny stock levels this month.
Although the company’s share price hit a high of $30 in July, the stock has fluctuated since, settling on a price of $0.59 at noon on Tuesday. SunEdison, which has accumulated $11 billion in debt acquiring renewable energies projects, is recovering from from the massive drop their stock price took on Tuesday.
The massive drop was not the worse part of this, the real losses were last fall.
TerraForm Global bought the 26.4-megawatt Alto Cielo solar farm in Uruguay from Spanish developer Solarpack Corp. Tecnologica SL, it said in a filing Friday, after the close of regular trading in New York. It paid $35.4 million for the power plant, which began operations last month.
The acquisition comes as TerraForm Global seeks to avoid being swept into potential insolvency proceedings of its parent. SunEdison is swimming in debt and is facing possible technical defaults on at least $1.4 billion in loans and credit facilities because it has yet to file its 2015 annual report. TerraForm Global warned in a March 29 filing that “there is a substantial risk that SunEdison will soon seek bankruptcy protection.”
So, this plant began only last month? And was sold…to a nearly bankrupt group? This is very bad stuff. The problem with solar energy is, it depends on government subsidies to survive when energy in general lost value in a huge way, note how gasoline prices are roughly half compared to two years ago.
Green Energy Bust in Germany and Will oil’s drop hurt renewable energy? – CNBC.com asks. Duh. Of course. U.S. Energy Secretary: Solar and wind energy now cost-competitive claimed our government last fall even as value of solar energy corporations began to collapse.
The fall in ALL energy values is hammering all holders and producers very hard, Saudi Arabia, for example, is facing economic ruin due to dropping values. If oil was more expensive, solar would be more sensible. But oil has fallen and taking down all others with it. Will oil’s drop hurt renewable energy? ask a liberal organization, CNBC, a year and a half ago.
Now we know the answer. And here is what the solar proponents dreamed up back then:
“Inevitably, there will be some impact because we think the high oil price is a key driver [for] renewable energy,” said Flora Chang, an energy analyst at Bernstein Research. But cheap oil will likely only delay some projects, not derail renewables’ advance, she said, sticking behind Bernstein’s November report giving a strongly positive outlook for the sector in Asia.
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