House Republicans are broadening attacks against White House energy
programs by targeting grants for renewable electricity projects issued
under the 2009 stimulus law, alleging the administration isn’t backing
up its job-creation claims.
House Speaker John BoehnerJohn BoehnerObamaCare gets new lease on life Ryan picks party over country by pushing healthcare bill The Hill's 12:30 Report MORE (R-Ohio) on Thursday bashed the administration for failing to respond thus far to letters from Energy and Commerce Committee Republicans seeking information about the program.
“More than $10 billion – that’s with a ‘b’ – $10 billion has been spent on this, and Secretary Chu said it created ‘tens of thousands of jobs,’ except there’s no evidence to support that,” BoehnerJohn BoehnerObamaCare gets new lease on life Ryan picks party over country by pushing healthcare bill The Hill's 12:30 Report MORE said in a statement.
“Listen, the American people continue to ask the question ‘Where are the jobs?’ They deserve answers and they deserve the truth,” he said.
Boehner called the Treasury Department grants a “Solyndra-style” program in reference to the taxpayer-backed California solar company that went belly up last year after receiving a $535 million Energy Department loan guarantee in 2009.
However, the grant program and the loan guarantee program are separate and different initiatives.
The big 2009 stimulus law created a new program that allowed renewable power project developers to obtain grants in lieu of traditional tax credit financing. It expired at the end of 2011 despite administration pleas to extend it.
The program was a response to the collapse of the tax credit financing market during the economic crisis, and renewable power advocates credit the grants with keeping new wind power and other renewables projects in the pipeline.
The tax credits had withered as an option because financiers lacked profits – and hence tax liabilities – to use the credits against, and some banks that backed renewable projects were in crisis or collapsed (including Lehman Brothers).
Chu, in testimony before the Energy and Commerce Committee in March of 2011, said the program has been “extraordinarily successful.”
“The Section 1603 tax grant program has created tens of thousands of jobs in industries such as wind and solar by providing up-front incentives to thousands of projects,” he said in calling for a one-year extension.
Boehner, in his statement, accused the administration of “wasting taxpayer dollars on failed ‘stimulus’ programs.”
A consultant to renewable power companies pushed back against Boehner’s allegations about spending on the 1603 program, named after the section of the stimulus law that spawned it.
The consultant noted that companies receiving grants were awarded them in lieu of tax credits that had already been authorized.
“1603 didn’t create a single new dollar of federal spending,” the consultant said. “If you qualified for the Production Tax Credit, you qualified for 1603, and the reimbursement was automatic. End of story.”