Energy offers loan to aluminum company for car parts

The Energy Department Thursday offered a conditional loan to aluminum giant Alcoa Inc. to make lightweight vehicle parts.

The conditional commitment for a $259 million loan is the first issued in four years under the Advanced Technology Vehicles Manufacturing program, which became controversial after some high-profile bankruptcies at companies that received loans.

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The money will go to improvements at Alcoa’s manufacturing plant in Alcoa, Tenn., to produce high-strength aluminum for North American auto makers, the Energy Department said.

“The department’s ATVM loan program can play an important role in helping to finance expanded domestic manufacturing of fuel-efficient technologies that will support the next generation of advanced vehicles and protect the environment by reducing greenhouse gas emissions,” Energy Secretary Ernest MonizErnest Jeffrey MonizAl Franken to host SiriusXM radio show Two years after Harvey's devastation, the wake-up call has not been heeded Biden under pressure from environmentalists on climate plan MORE said in a statement.

The Alcoa announcement came a day after Sen. Lisa MurkowskiLisa Ann MurkowskiHere are the Senate Republicans who could vote to convict Trump Senate confirms eight Trump court picks in three days The Hill's Morning Report - Dem impeachment report highlights phone records MORE (R-Alaska), chairwoman of the Energy and Natural Resources Committee, criticized the department's handling of the program.

“The is the 48th consecutive month that the ATVM direct loan program has been unable or unwilling to finalize a new direct loan for an automaker or component supplier,” she said at an Appropriations Committee hearing.

“It really begs the question in terms of why we would continue to have this program on the books, why we would continue to have taxpayers’ support there.”

Moniz recognized the problems, but said his department has taken steps to improve it.

“The ATVM program had some problems in terms of dealing with applicants,” he said. “I believe we have cleaned that up. And we’re getting a lot of interest.”

He pointed to an announcement the Energy Department made a year ago in which it clarified that vehicle component makers are eligible for loans and loan guarantees, and pledged to be more responsive to those companies.

Vehicle lightweighting has become a priority for the Energy Department’s vehicle technology efforts, because making a vehicle lighter without compromising safety can make it more fuel-efficient.

Alcoa estimated that the expansion project the loan is helping to fund will create 200 new full-time jobs, plus another 400 for construction.