U.S. Republican lawmakers are stepping up their investigation into alternative energy loan programs in the wake of the collapse of the Solyndra solar company, the first company to receive such government funding.
With only days to go before the Department of Energy faces deadlines to finalize $8.9 billion in loans for 14 pending renewable energy projects, Congressional investigators asked for detailed financial information on the deals and the due diligence done by the government.
``We are concerned that another rush to meet stimulus deadlines will result in DOE closing these deals before they are ready,'' said Fred Upton, Cliff Stearns and Ed Whitfield of the House Energy and Commerce committee, in a letter to Energy Secretary Steven Chu Tuesday.
The lawmakers have been probing whether politics influenced government loans to Solyndra, and had expected company executives to answer questions at a hearing on Friday. But lawyers for Solyndra executives said their clients would invoke their fifth amendment rights and would not answer questions, according to letters obtained by Reuters.
Investigators asked for an update from the Energy Department on the status of its new loan reviews by Friday, and a briefing on all its loan guarantees by Monday. They also asked for credit reviews and monitoring reports on the department's entire portfolio of 18 clean energy loan guarantees worth $9.4 billion.
A spokesman for the Energy Department said that every deal closed by Sept. 30 will be ``fully vetted'' and has had months of extensive review. ``We are not rushing to complete deals, we are using the full amount of time Congress allocated for the program so we can ensure that we fully complete all due diligence and make informed decisions based on the most recent data,'' DOE spokesman Damien LaVera said.
ENOUGH DUE DILIGENCE?
The loan guarantee program was created in a 2005 energy law, and its funding was supplemented by the federal economic stimulus package.
The Energy Department has closed on a total of 18 guarantees, but had made conditional commitments for 14 other loans for solar, wind, biofuel and geothermal projects around the country.
``We question whether the DOE needs additional time to conduct its due diligence to ensure taxpayer dollars are not being put at risk unnecessarily,'' the lawmakers said, noting most of the conditional loans were issues in June or later.
Three of the conditional offers were to First Solar for large solar power plants in California.
First Solar shares slipped to a four-year low of $78.68 per share after the news and closed at $79.21, down 5.6 percent. The process for vetting and awarding the loan guarantees has been cumbersome and the new Congressional request will likely delay loans further, said Theodore O'Neill, a solar industry analyst with Wunderlich Securities.``The big companies will look for financing somewhere else,and the smaller companies are going to struggle,'' O'Neill said.
SOLYNDRA EXECUTIVES WON'T TESTIFY
Solyndra was the first company to receive loan guarantee funding, securing $535 million in guarantees in 2009. The company filed for bankruptcy last month, and is the focus of investigations by the FBI and by Republicans in Congress.
Solyndra Chief Executive Brian Harrison and Chief Financial Officer W.G. Stover had agreed to testify to Congress about the loans, but on Tuesday, their lawyers said they would not answer questions, according to letters obtained by Reuters.
The Solyndra loan had been hailed by President Barack Obama and other top administration officials as a model of how the government could kick-start job growth in clean energy.
The company and Energy Department have blamed heavily subsidized competition from China for the company's woes.
But Republicans have uncovered e-mails showing concerns about the company's finances dating back before the loans were made. Other e-mails suggested decisions may have been rushed to accommodate the schedules of Obama administration officials who wanted to promote them.