It's mostly because it's an ability to make an energy weapon, but you can't take much feat support for it, it doesn't add any attribute damage mods, it can't be enchanted, and it isn't a touch attack to make up for any of this so it's effectively just a short sword, but worse in every imaginable way.

If one of the major aspects of an archetype is "you can make throwing axes that are outscaled almost right away" then there's a problem.

I just rule they instead of a scaling bonus to damage they add attribute and enchant them in rare schools or with arcane study for the normal price of enchants. Not like having what amounts to an infinite supply of throwing axes is op or anything.