Big news for those who like political spats over energy policy: A123 Systems, an electric-car-battery manufacturer that received $249 million in federal grants as part of the stimulus bill, filed for Chapter 11 bankruptcy protection Tuesday.

The Wall Street Journal has the details here. The company isn't vanishing entirely. It's selling $125 million of its auto assets to U.S. manufacturer Johnson Controls, which will provide financing to the company in bankruptcy. So far, A123 had drawn on just half of its federal grant money, $129 million, to build a factory in Michigan — a factory that will stay open for the time being.

Since A123 received stimulus funds, this is likely to become political fodder. Mitt Romney has already weighed in: "A123's bankruptcy is yet another failure for the president's disastrous strategy of gambling away billions of taxpayer dollars on a strategy of government-led growth that simply does not work."

So let's go through a few facts about A123 Systems—and the stimulus-funded battery industry more broadly:

1) A123 had a nifty idea for batteries—and seemed promising back in 2009. The company was co-founded in 2001 by Yet-Ming Chiang, a materials scientist at MIT who had developed a new technology for fast-charging lithium-ion batteries. By 2009, the firm had raised $350 million in private funding, $380 million through its initial public offering, secured $135 million in tax breaks from Michigan, and received $250 million in grants from the federal government as part of the stimulus.

Hopes were high. Every member of Michigan's congressional delegation, Democrat and Republican, had co-signed a letter in 2009 to Energy Secretary Steven Chu supporting A123's application for federal support. The company used part of its federal grant money to build a manufacturing plant in Livonia, Michigan.

2) But as the nascent U.S. battery industry struggled, so did A123. The 2009 stimulus included $2.4 billion to kick-start a U.S. electric-car-battery industry. But as we've noted before, the industry has struggled since. There's still too much advanced battery capacity and not enough demand, as sales of electric cars remain weak. What's more, battery factories in Asia remain extremely competitive, in part because they've had a big head start. The Chevrolet Volt, for instance, still imports battery cells from South Korea.

On top of those general pressures, A123 Systems made its own missteps, as Kevin Bullis documents here. The company relied too heavily on one customer, Fisker, which was slow in bringing its Karma electric sedan to market. When Fisker finally did place an order for batteries, A123 rushed to fill it and ended up producing defective cells—forcing a costly $55 million recall. All told, Bullis estimates, A123 would have needed to sell ten times as many battery packs, or about 50,000 per year, to become profitable.

3) Another U.S. firm, Johnson Controls will take over A123's Michigan factories, technology, and customers. A123 has two battery factories in Michigan and an equity stake in a battery manufacturer in Shanghai. Johnson Controls will acquire those assets, as well as A123's contracts to supply batteries for Fisker and the upcoming Chevrolet Spark. It's still not clear, however, what will happen to A123's non-vehicle businesses, such as providing batteries for the electric grid.

Back in August, Rep. Cliff Stearns (R-Fla.) had expressed concern that Chinese auto-parts maker Wanxiang Group might come along and buy up A123's "sensitive taxpayer funded intellectual property." But Wanxiang now appears to be out of the running for A123 after providing an early loan.

4) Of the 30 battery and electric drive companies that have received stimulus funds, A123 is now the second to go bankrupt. Let's review the stimulus scorecard. To date, 30 battery and electric drive firms have received stimulus funding. A full list is here. Two companies, A123 Systems and Ener1, have filed for bankruptcy so far. (It's important to note, however, that the subsidiary of Ener1 that actually received the stimulus grant, EnerDel, never went through restructuring and has continued to operate two factories in Indiana the whole time.)

In a similar vein, of the 26 clean-energy projects that have received federal loan guarantees under a separate 1705 program, just three have filed for bankruptcy, including Solyndra, Abound, and Beacon Power. (Though, again, Beacon is still operating and has largely paid back its federally backed loans.)

5) Here's the administration's defense of its broader battery investments, for those curious. Over at the Department of Energy's website, public affairs officer Dan Lestikow offered his take on the A123 bankruptcy. First, he noted that A123's factories aren't disappearing—they're being taken over by Johnson Controls. "In an emerging industry," he writes, "it’s very common to see some firms consolidate with others as the industry grows and matures."

Second, Lestikow wrote that other U.S. battery factories are still going strong, such as the newly expanded Rockwood Lithium plant in North Carolina. And third, he argued that the stimulus program has helped bring electric car-battery prices down from $33,000 before the stimulus to $17,000 today and an expected $10,000 by 2015. "As costs come down even further," Lestikow writes, "the market for hybrids and electric vehicles—which has nearly doubled in the U.S. since last year—will grow even further."

That was the big gamble with the stimulus investments. By driving down the cost of batteries, the Energy Department was hoping to make electric cars affordable and widespread. But the plan hasn't gone entirely smoothly—and two of the federally backed companies have now gone bankrupt—which is why it's now such a frequent target of criticism.

* Correction, A123 received a federal grant, not a loan guarantee as originally stated.

Further reading:

Here's our earlier look at why the U.S. battery industry is struggling.

—For a more optimistic take on the future of electric cars, here's a July report from McKinsey & Company predicting that battery prices could soon drop dramatically, making electric vehicles truly competitive in the near future.