Program that backed Solyndra turns profit

The controversial federal program that funded a loan guarantee to failed solar company Solyndra has now turned a profit.

Interest payments from the Department of Energy’s (DOE) Loan Programs Office were $810 million in September, the first time they exceeded the $780 million in losses from bankrupt companies like Solynda, Fisker Automotive and Abound Solar, Reuters reported Thursday.

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The results, found in a report by the office, are a political victory for the highly controversial program that seeks to help develop alternative energy and energy efficiency technology.

After Solyndra’s bankruptcy in 2011, it became a symbol of Republicans’ charges that the Obama administration wanted to pick winners and losers in the marketplace and chose bad companies to prop up. It served as a political football in the 2012 presidential race.

The DOE has defended the program, saying that with a default rate of around 2 percent, its portfolio has performed better than most in the private sector.

The department told Reuters that the September report shows its loans are good for taxpayers.

“Taxpayers are not only benefiting from some of the world's most innovative energy projects ... but these projects are making good on their loan repayments," Peter Davidson, executive director of the Loan Programs Office, told Reuters.

While defending its historic decisions, Davidson said the office feels its portfolio is safer than it was before, largely because it is funding more big power plants than it previously had.

The loan program started in 2005 under George W. Bush, but added a renewable energy component in 2009 thanks to the stimulus bill.

The DOE recovered much of the funding from loan defaults and bankruptcies. Officials have also pointed to its many successes, such as loan guarantees to Tesla Motors Inc. and Nissan Motor Co.