raser

The Energy Policy Act of 2005 authorized the secretary of energy to make loan guarantees to qualified renewable energy and energy efficiency projects. It was supposed to add a much needed public boost to the development of U.S. renewable energy and energy efficiency technologies, as well as the economy.

Instead, the Department of Energy sat on billions of dollars in loan potential. Companies applying for the loans spent as much as $10 million on the process and waited as long as three years for a loan guarantee without a single one being granted by the Bush administration.

No longer.

Energy Secretary Steven Chu pledged to speed up action on the loan guarantees earlier this year when Congress expanded the program from $38.5 billion to $100 billion in the recent stimulus package, and he seems to be making good on that promise.

Three loans have been granted in the last seven months and several more are moving forward.

Raser Technologies’ financial history is not terribly flattering.

Last December, Motley Fool was singling the company out as a poster child for debt-ridden businesses with no discernible free cash flow, based on the firm’s $80 million in long-term debt and its paltry $284,000 in reported revenue.

The company had struggled unsuccessfully for years to profit from its Symetron AC motor technology, which it had been marketing as an improvement over both existing AC electric motor designs (in terms of torque) and high-torque, permanent-magnet electric motors (in terms of price).

Raser's pitch included eco-conscious overtures to hybrid electric vehicle manufacturers, which may be the only logical explanation for its curious new expansion — into geothermal energy.

What’s even more curious is that it seems to be working.