Last week there was quite some fuss about the near bankruptcy of a Belgian green energy producer, Electrawinds. They manage installations that produces green power via wind, solar, biomass and also bio-diesel.
I know there were a lot of bankruptcies last year among for example solar panel installers (because of less subsidies given to install solar panels), but Electrawinds isn’t really a small company and received loads of governmental support. Until shortly it was considered a success story. There were many projects, not only in Belgium, but also in France, The Netherlands, Italy, Serbia and Kenya. There were even plans to build a prestigious, futuristic looking new headquarter in Ostend.
But last year they reported a loss of 361 million euro and then things went downhill very fast. Several efficiency measures were taken, involvement in some projects (bio-diesel) was diminished, two rescue plan were rejected. If they don’t come up with a solution this weekend they will file bankruptcy on Monday…
Most news media told about the same story with largely the same words, so I guess they all originate from the same source. According to different sources the amount of subsidies was more than 140 million euro. This amount is without the income of green certificates (money given for the production of green electricity – not really a subsidy, but indirectly paid by the consumers).
The subsidies were detailed in the open letter to Minister vande Lanotte (Dutch), written by Jean-Marie Dedecker (founder of the political party LDD), is very detailed and gives a lot of background information that the media doesn’t bring. Not only a detailed list of the subsidies, but mostly background information about the many political connections between Electrawinds and (the entourage of) the Minister.
How did this happen? Electrawinds went in a short timespan from a successful example of green entrepreneurship to a financial disaster. When looking deeper, there were more darlings of the green economy that are in serious trouble or experienced it in the recent past (4Energy Invest, Enfinity and Thenergo) or stopped altogether (Photovoltech, V&R Solar Company and Solar Living).
People are still claiming renewable sources of energy don’t depend on subsidies anymore and are even cheaper than gas or nuclear. But the gruesome reality is that many of the green companies were dependent on the subsidies and had to file bankruptcy when the subsidies diminished. Take away the subsidies and the system starts to collapse.