Yesterday (March 29), the Massachusetts Senate Committee of Post Audit and Oversight held a hearing with Evergreen Solar, Inc. (Nasdaq: ESLR) CEO Michael El-Hillow that lasted more than six hours.
The committee, chaired by State Sen. Mark Montigny (D-New Bedford), was grilling El-Hillow and Fidelity Investments President Ron O’Hanley over both companies’ plans to move jobs out of Massachusetts after receiving millions in incentives to bring jobs to the commonwealth.
Evergreen Solar was under fire for shuttering its Devens, Mass., facility, which employed 800 Massachusetts residents. The company had received $58 million in state incentives to locate the facility in the state.
In January, Evergreen Solar said it was shuttering the plant.
“We shut down Devens manufacturing facility because it couldn’t produce at a cost that was [competitive] internationally,” said Evergreen spokesperson Michael McCarthy.
Evergreen Solar has not been profitable in manufacturing its string-ribbon silicon wafering technology in the U.S. Most recently, the company reported a net loss of $411.0 million for the fourth quarter of 2010. To better compete, the company is moving all of its production to China.
At the same time, the company said it was changing its business model.
“We have transitioned it to a business model where Evergreen Solar will be a wafer company,” McCarthy said. The company now is focused on developing a standard-sized photovoltaic wafer, which McCarthy said Evergreen Solar can produce for 25 cents per watt.
During the hearing, El-Hillow told the committee that the company didn’t plan to return any of the $20 million in taxpayer cash to expand operations in Massachusetts, according to The Boston Herald.
“Quite frankly, this was not a bad deal; the citizens got their money’s worth,” he said. “But it didn’t work out.”
The company met 85 percent of its employment goals under the agreements it made with the state, according to McCarthy. The agreements are also for eight years, so the company feasibly could reach full compliance with its agreements.
Although the company is moving its silicon-wafering production to China, it will maintain its headquarters as well as its research and development offices in Massachusetts, McCarthy said.
Whether or not the state will take any actions to rescind the contracts or take back some of the incentives remains to be determined.
Sen. Montigny was unable to comment by press time.
Image courtesy of Evergreen Solar.