First Solar (NASDAQ:FSLR) has received a $20 million subsidy from Maricopa County in Arizona, for the purpose of creating up to 4,800 jobs in the region.
The capital will be paid in stages, based on $1 million for every 240 jobs created by the company at its Mesa factory.
According to the terms of the deal, the money will only be paid out to First Solar if it produces the jobs, up to a $20 million cap.
While this sounds good, the global supply of solar has been increasing at a time when demand is decreasing, making the deal one that could be tough to deliver on.
The government shouldn't be in the business of attempting to create jobs in this way, as the market should be the deciding factor in what forms of energy we want to consume.
It also skews the market and makes the financial health of energy companies like First Solar hard to discern because of the interference of the government.
As to the long-term effect of wasting money in this manner, solar is far from a done deal, and the need to continually subsidize the sector because of the high price of generating the so-called green energy, will be difficult to sustain.
First Solar closed Thursday at $160.84, gaining $5.45, or 3.51 percent.
No comments:
Post a Comment