Loan Program Fallout Sparks Criticism

The fallout from failed solar panel maker Solyndra continues.

For starters, it’s not the only clean-tech start-up to receive a government loan guarantee only to turn around and file for bankruptcy in what has become a series of embarrassments for the Obama administration and its clean energy initiatives.

The Wall Street Journal reports Beacon Power Corp., which converts energy from the power grid into the energy of spinning flywheels, filed for bankruptcy on October 30.

It had received a $43 million loan guarantee, the Journal notes.

Beacon had used the funds to build a plant. It had drawn down about $39 million. The loan carries the new plant as collateral. The U.S. has first priority, the Journal says. That’s opposed to Solyndra, which had drawn down about $527 million of $535 million in guarantees, according to the Journal.

Republicans are vocal in their criticism of the loan guarantee program that resulted in these failures and called a hearing for November 3 to consider subpoenaing the White House, Bloomberg reports. Representatives Fred Upton and Cliff Sterns have questioned whether Solyndra got favorable treatment because of political connections, Bloomberg says.

According to Reuters, Darrell Issa, chairman of the House Oversight Committee, wants the Energy Department to show documents and emails about the guarantees that were approved prior to the deadline in September and that may not have been properly vetted.

The White House has since ordered a review of the loan program. Bloomberg says Treasury official Herbert Allison will head up the investigation. In addition, Energy Secretary Steven Chu will testify about Solyndra on November 17.
Solyndra has forced the Obama administration to defend its clean tech development efforts. Bloomberg cited a statement from Chu, in which he said the loan programs are putting Americans to work and will help the nation compete for clean-energy jobs.

In an additional blow, Jonathan Silver, the head of the Energy Department’s loan program, stepped down on October 6, according to The Washington Post.

Republicans said Silver’s resignation did not quell their concerns with the program, citing the series of deals that closed prior to the funding deadline.

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