Flywheel manufacturer Beacon Power has filed for bankruptcy as it became harder and harder for it to find capital, Bloomberg reported.

Flywheels are an energy-storage technology frequently used as a cleaner and lower-maintenance alternative to the traditional lead-acid batteries for storing energy in uninterruptible-power-supply (UPS) applications, including data center UPS.

In the company's bankruptcy papers filed in the US Bankruptcy Court in Wilmington, Delaware, Beacon CEO William Capp attributed the move to a number of factors.

“The current economic and political climate, the financing terms mandated by DOE, and Beacon’s recent delisting notice from Nasdaq have together severely restricted Beacon’s access to additional investments through the equity markets,” Capp wrote, according to Bloomberg.

Earlier this month NASDAQ gave the company 180 calendar days to bring the bid price of its common stock to a minimum of US$1 a share if it wanted to retain its listing on the exchange. Beacon received the notice after its stock value stayed below the required minimum for 30 consecutive days.

According to Bloomberg, Beacon has been loosing money. IT reported revenue of $525,000 in the second quarter of 2011 and a net loss of $6.2m – a bigger loss than it reported for the same period last year, when it lost $5.5m. Beacon's bankruptcy filing may take on a political dimension, as the US federal government backed $43m in the company's loans.

This was done through the same loan-guarantee program as loans to Solyndra, a solar-energy company that filed for bankruptcy in September. There is an ongoing probe into the backing of Solyndra's loans, which was strongly supported by the President Barack Obama's administration.

Since the company's bankruptcy filing, the administration has been under fire for continuing to support the loan guarantee even after a warning by PricewaterhouseCoopers in 2010 that Solyndra was having deep financial troubles.