In my most recent column, I noted that Solyndra made a solar product that could find application in the data center industry. To my surprise, Solyndra recently put itself into a Chapter 11 bankruptcy, citing Chinese competition as a significant factor. Worse, the company has become part of a political controversy since it was the subject of a photo op with President Obama and received Department of Energy (DOE) loan guarantees. Even worse, recent front-page pictures show investigating FBI agents standing by the Solyndra headquarters building (a sight that should give pause to other DOE loan guarantee recipients).
While counter-party risks do not typically rise to such a dramatic level, this situation points up the need for careful assessment of risk factors associated with suppliers of on-site generation equipment. Failure of a supplier can put both long-term reliability and short-term mission critical performance at risk.