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MassCEC Approves $5M Forgivable Loan for A123 Systems; Targeted at Expansion for Grid Storage Systems

The Massachusetts Clean Energy Center (MassCEC) has approved a $5-million forgivable loan for Li-ion battery manufacturer A123 Systems contingent on its hitting job creation and private investment milestones. The company anticipates making $80 million in capital expenditures in Massachusetts to build up its manufacturing and R&D capabilities there by the end of 2014.

With the new expansion, A123 Systems will assemble and commission grid-storage battery systems in Massachusetts. Under the terms of the MassCEC financing, A123 will double its Massachusetts employment to more than 500 by 2014.

A123 Systems has added more than 50 corporate and research and development jobs in Massachusetts in the last year associated with its expanded US manufacturing capacity in Michigan. The expansion was supported by a $249 million federal stimulus US Department of Energy grant designed to accelerate the manufacturing and deployment of the next generation of batteries for plug-in hybrid and all-electric automobiles.

Founded in 2001, A123 Systems develops and manufactures advanced lithium ion batteries and battery systems for the transportation, electric grid and consumer markets. Headquartered in Watertown with additional facilities in Hopkinton, the company is a leading supplier of battery systems for a wide variety of next-generation energy storage applications. In September 2009, A123 raised $378 million in its initial public offering.

Comments

sulleny

A small "loan" to help stim jobs in Chusetts. Not sure why this makes sense except to tell business if you create jobs, there will be cash. OK. A123 is in a good position to bring some manufacturing back to MA. A battery assembly plant would be welcome. And additional R&D facilities would also be welcome.

By 2012 we should see enough EV sales to indicate the need for even more large format Li-Ion batteries. Good for MassCEC.

HarveyD

A123 systems have very good batteries that can be further improved and mass produced at lower cost with enough public financial support to stay competitive. It is important and essential for USA's economy that vehicular batteries be mass produced locally. More incentives and large very low interest loans may be required. Governments could also buy some the initial shares and profit from a fast growing industry.

sulleny

Agree mostly. VC and bank loans can finance any new technology that demonstrates profit potential in the near and long term. Building local assembly and quality control manufacturing is a primary goal for new US industry.

The trick is to find employee compensation packages that meet cost of living standards while not driving cost of goods too high. I believe that entry level assembly jobs in high tech manufacturing is better than entry level fast food or service sectors. People get trained in BUILDING something made locally. This creates a sense of pride and accomplishment that serving burgers and beer never will.

Note: Cut my teeth assembling floppy drives years ago which morphed into better jobs.

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