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House GOP: White House rushed $535M Solyndra loan guarantee
Republicans blasted top Obama administration officials Wednesday for green-lighting a $535 million loan guarantee to a now-bankrupt California solar company, alleging that the White House rushed approval of the taxpayer-backed loan without adequate oversight.
The GOP has sought to pummel the White House on the issue in recent weeks, seeing an opening to bash the Obama administration’s push to invest billions in clean energy.
“In this time of record debt, I question whether the government is qualified to act as a venture capitalist, picking winners and losers in speculative ventures and shelling out billions of taxpayer dollars to keep them afloat,” House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) said Wednesday during a subcommittee hearing on the Solyndra loan guarantee.
But Jonathan Silver, the executive director of the Energy Department’s Loan Programs Office, insisted that Obama administration staff did not feel pressure to quickly finalize financing for the project.
White House press secretary Jay Carney rejected allegations that the administration rushed the review of the loan guarantee.
"What the emails, I believe, made clear is that there was urgency to make a decision about a scheduling matter," Carney told reporters on Air Force One on Wednesday. "As you know — and you are familiar with it in a way that most Americans aren’t — it is a big proposition to move the president or to put on an event and that sort of thing. So people were simply looking for answers about whether or not we could move forward."
The Obama administration has made clean energy a central component of its domestic policy agenda, pushing policies to invest in low-carbon energy sources like wind and solar.
Despite Solyndra’s financial problems, the Energy Department has continued to approve loan guarantees for major solar projects. The department, for example, finalized an $852 million loan guarantee for a separate California solar project sponsored by NextEra Energy in August.
Rep. Cliff Stearns (R-Fla.), chairman of the panel’s Oversight and Investigations subcommittee, sought to place blame for the loan guarantee debacle on the Obama administration’s shoulders.
“Only after the Obama administration took control and the stimulus passed was the Solyndra deal pushed through,” Stearns said.
But the Obama administration, along with Democrats on the panel, sought to spread blame to the Bush administration, which began considering Solyndra’s loan guarantee application, but did not finalize it.
Silver noted in his testimony at the hearing that the Bush administration identified Solyndra as a top contender for receiving a loan guarantee.
The Obama administration ultimately approved the loan guarantee in 2009 “on the exact schedule that had been developed during the Bush administration,” Silver said.
But Republicans countered that the Bush administration raised concerns about the loan guarantee, noting that an Energy Department committee in 2009 remanded the application for further review.
Silver also noted that market forces, along with competition from China, put major strains on the solar industry in recent months, making “Solyndra’s business model very challenging.” The market changes took many analysts and the company by surprise, he said.
The Solyndra bankruptcy shows that the United States must double down on its investments in clean energy in order to compete with China, Silver said.
“The question is whether we are willing to take on this challenge, or whether we will simply cede leadership in clean energy to other nations and watch as tens of thousands of jobs are created overseas,” Silver said. “We were once the leaders in this field, and we can be again."
Democrats blasted Republicans for politicizing the bankruptcy.
“This is all part of an agenda here that deals with the solar industry and the wind industry,” Rep. Edward Markey (D-Mass.) said.
Democrats on the panel also suggested top executives at Solyndra misled them about their financial outlook during a July meeting in Washington.
“I’m perplexed how they can be in my office in July telling me things are looking better and two months later filing for bankruptcy,” Rep. Diana DeGette (Colo.), the top Democrat on the committee’s Oversight panel, said.
Solyndra executives are slated to testify before the panel next week.
Solyndra announced in late August that it would suspend manufacturing, lay off 1,100 employees and file for bankruptcy.
Republicans launched an investigation into the Obama administration’s decision to grant the loan guarantee earlier this year after Solyndra encountered a number of financial setbacks.
Solyndra announced last year that it would close a plant, lay off employees and delay the expansion of its newest facility. It also canceled plans for a public stock offering.
— This story was updated at 1:03 p.m.
