Assault On Solar? House Republicans Fire Off ‘No More Solyndras Act’

SI Staff
Written by Laura DiMugno
on July 12, 2012 No Comments
Categories : Policy Watch

10722_no_more_solyndras Assault On Solar? House Republicans Fire Off 'No More Solyndras Act' Just when the political squabbling and accusations over failed loan-guarantee recipient Solyndra had seemed to subside, Republicans in the House of Representatives have offered up a new measure that would essentially eradicate the now-infamous program.

The legislation – dubbed the ‘No More Solyndras Act’ – would phase out the loan-guarantee program established under the Energy Policy Act of 2005.

Although the bill takes aim at Solyndra – which has become a keystone of congressional Republicans' anti-Obama rhetoric – it is also an attack against clean energy and, more specifically, solar. When thin-film module manufacturer Abound Solar – another DOE loan-guarantee recipient – announced last week it was suspending operations, it seemed almost inevitable that the Solyndra talks would resurface.

The bill – introduced by Reps. Fred Upton, R-Mich., and Cliff Stearns, R-Fla., two central figures leading the epic Solyndra investigations – would forbid the DOE from issuing a loan guarantee for any application received after Dec. 31, 2011. Pending applications that were submitted before that date would remain active, but companies would have to meet a host of criteria in order to receive a loan guarantee.

First, proposed loan guarantees would have to be reviewed by the Treasury Secretary, and if it is determined that the guarantee has merit, the Treasury Secretary would be required to issue a written recommendation to the Secretary of Energy within 30 days. If the Energy Secretary and the Treasury were to disagree on aspects of the written recommendation, the proposal would be evaluated by the House Committee on Energy and Commerce and the Senate Committee on Energy and Natural Resources.

If the guarantee were made, the DOE would be required to report back to Congress on the recipient, the terms of the guarantee, and the technology and project for which the guarantee would be applied.

The DOE would also be required to consult with the Treasury on any restructuring of the guarantee's terms or conditions.

Although Section 1705 of the program – the provision under which Solyndra was backed – has expired, the DOE is still considering applications for loan guarantees under Section 1703, which authorizes the DOE to support clean energy technologies that are unable to obtain conventional private financing. In fact, there is still some $34 billion remaining under Section 1703 for loan guarantees, according to the bill.

Indeed, companies are lining up to receive this funding, Bloomberg Businessweek reports.

Among those firms are Portland, Ore.-based thin-film module manufacturer SoloPower and 1366 Technologies, a Massachusetts-based company that develops new ways to manufacture silicon wafers and cells. Both companies qualified for loan guarantees last year but are still working to reach the milestones needed to access the credit, according to the Bloomberg report.

The House Energy and Commerce Committee will hold a hearing on the bill today. David G. Frantz, acting executive director of the DOE's Loan Program Office, and Dr. Kathleen Hogan, deputy assistant secretary for the DOE's Office of Energy Efficiency and Renewable Energy, are expected to testify.

Also on the witness list are Diana Furchtgott-Roth, a senior fellow at conservative think tank Manhattan Institute for Policy Research, and David W. Kreutzer, research fellow in energy economics and climate change at The Heritage Foundation. Kreutzer is expected to testify that the loan-guarantee program"is based on flawed understanding of capital markets," according to prepared written remarks.

"The loan guarantees misallocate capital, reduce productivity and burden federal finances," he wrote in prepared testimony." Loan-guarantee recipients should be able to procure private financing if their projects are truly commercially viable."

No one from the solar energy industry is expected to testify at the hearing, but not surprisingly, the legislation got a cold reception from the Solar Energy Industries Association (SEIA).

"The loan program has been utilized on a bipartisan basis to leverage private capital to promote transportation, healthcare, education, housing and energy infrastructure policies," SEIA said in a statement." The provision in the discussion draft that sunsets DOE's loan program would hinder our nation's ability to develop innovative energy infrastructure projects."

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