Letters From the West

Hoku plant shutdown is no empty promise

Hoku Materials polysilicon manufacturing plant in Pocatello. (Hoku Materials Photo)

Hoku Materials polysilicon manufacturing plant in Pocatello. (Hoku Materials Photo)

No one is happy when a brand new $700 million manufacturing plant stands idle in Idaho.

The Idaho State Journal reported the news that Hoku Materials had laid off its last engineer and had given up plans to seek a joint venture for the Pocatello plant that made polysilicon for solar panels. It headline expressed the basic view: “Hoku proves an empty promise.”

The Hawaii-based company now largely Chinese-owned was envisioned at a time there was a shortage of polysilicon and a huge rising demand in solar panels But former Hoku CEO Dustin Shinto and his associates weren’t the only people with that vision and by the time the plant came on line there was a glut of silicon and the solar industry was in the middle of a trade war.

Hoku could not recover even with generous Chinese financing. The same happened to Transform Solar, a joint venture between Micron Technology and Australian energy services company Origin.

Transform completed a solar panel plant in an old Micron manufacturing facility in Nampa, only to be forced to give up because of the oversupply of solar panels from a world industry where many visionaries had the same vision at the same time.

But empty promise?

Yes, there won’t be up to 250 people working at the new manufacturing facility in Pocatello nor 250 people building solar panels in Nampa.

But because of the wisdom of Pocatello community leaders and Idaho Power, Hoku’s failure is not a huge burden on the state. The Bannock Development Corp. and city leaders decided not to bond the $20-40 million Hoku needed as a part of its initial financing.

“Since they were a start up company we said we can’t afford to take that risk,” said Gynii Gilliam, then the Bannock Development Corp. executive director.

Gilliam, now with the Idaho Department of Commerce is hopeful someone will buy the plant whole and pick up where Hoku left off. But even if the plant is dismantled in bankruptcy court– a fate I still think is unlikely– The $900,000 Pocatello paid for the 67-acre site with a 100 megawatt substation paid for by Hoku, not Idaho Power will remain even more ready for another factory.

The same is true for Micron’s Transform Solar site in Nampa. At the time of its closing last year there were reports about the $1.68 million in job training that wouldn’t be paid back.

But those workers now have the training for similar work. And think about all the construction jobs that were created and all of the investment brought into Idaho for both facilities. They came at a time when the economy was really short and construction workers really needed work.

There are no promises in economic development, especially with start-up companies at all levels. The state-of-the-art plant in Pocatello may be bought dimes on the dollar and kept together to give its investors at least some pay back.

That would make the plant very competitive for its next owners.

Rocky Barker is the energy and environment reporter for the Idaho Statesman and has been writing about the West since 1985. He is the author of Scorched Earth How the Fires of Yellowstone Changed America and co-producer of the movie Firestorm: Last Stand at Yellowstone, which was inspired by the book and broadcast on A&E Network. He also co-authored the Flyfisher's Guide to Idaho and the Wingshooter's Guide to Idaho with Ken Retallic. He also was on the Statesman’s team that covered the Sen. Larry Craig sex scandal, which was one of three Pulitzer Prize finalists in breaking news in 2007. The National Wildlife Federation awarded him its Conservation Achievement Award.

Posted in Letters from the West