A House Oversight and Government Reform subcommittee dug further into the $90 billion directed toward green-energy initiatives in President Obama’s 2009 stimulus, noting questions not only about whether the programs have wasted taxpayer money but whether the White House pulled strings for some firms.
“When taxpayers lost over a half-billion dollars on Solyndra, the Obama Administration said that it was just one bad apple and that the rest of the portfolio was strong,” said subcommittee chairman Jim Jordan (R-Ohio). “It is becoming increasingly clear that Solyndra was just the tip of the iceberg in a sea of taxpayer risk.”
The Regulatory Affairs hearing was made even better by the chairman of the full committee, Rep. Darrell Issa (R-Calif.), dropping in to question the six CEOs of alternative-energy companies lined up at the witness table.
Four of those companies together received $5 billion in loan guarantees from the Department of Energy.
“Alternative energy certainly has a place in our economy and we hope that all of these companies succeed,” Jordan said. “But the best way to get cheap energy to American consumers is to let market forces work, not allow bureaucrats in Washington to pick winners and losers through a politicized process.”
Ranking Member Dennis Kucinich (D-Ohio) quipped that Republicans hadn’t raised questions “over the last 100 years” for fossil fuel subsidies, and lamented that they had devoted four hearings to scrutinizing the green-energy loans.
“If we fail to support these renewable energy technologies our country will fall behind countries like Germany and China,” Kucinich said. “I think we should be helping to preserve America’s leadership.”
One witness who didn’t ask for any DOE money, James B. Nelson, described the work of his Santa Barbara company Solar3D, Inc., which is developing an advanced technology cell that could cut the cost of solar energy in half.
“Our objective is similar to that of ill-fated Solyndra — to develop a new solar technology that can change the economics of the industry. However, our manner of execution is very different,” Nelson told the committee.
“We have been supported by private investment in our company since its establishment in August of 2010,” he said. “We are not depending or dependent on government funding. We certainly do not expect that such support will be necessary to facilitate the commercialization of our new technology.”
Jordan noted that Nelson “didn’t come ask for help and his company is succeeding and we applaud that.”
Nelson, saying that he didn’t see the loan recipients as having a competitive advantage over private-investment companies such as his, said he didn’t blame the other witnesses for taking advantage of the taxpayer cash.
“The problem is not in their approach,” the CEO said. “The problem is in the rules.”
And agreeing that “we shouldn’t have had this goofy program going on in the first place,” Jordan and his colleagues went after those loans.
In the 30,000 documents given to the committee on Friday, Jordan highlighted for BrightSource Energy Inc. CEO John Woolard an email in which it appears that the White House may have given a boost to the firm in its quest for financing.
In January 2010, Woolard emailed Matt Rogers, then senior adviser to the secretary of Energy for the Recovery Act, stating that Peter Darbee, then CEO and chairman of Pacific Gas and Electric, “talked directly to Obama about the program’s challenges and the bad situation it puts him in.”
“They had a vested interest in getting this thing approved because you were providing them their required commitment for green power,” Jordan said when questioning Woolard about the email. “One month after this email, you got the conditional approval.”
Woolard said he believed the approval was based “completely on the merits of the project.”
Jordan presented another email in which Woolard asked Jonathan Silver, executive director of the DOE loan program, to proofread a drafted email that then BrightSource chairman John Bryson intended to send to White House Chief of Staff Bill Daley: “We need a commitment from the WH to quarterback loan closure between OMB and DOE,” read the email, which Woolard said “to the best of my knowledge” was never sent.
Bryson is now Obama’s Commerce secretary, sworn in last October.
“If that’s not political influence, I don’t know what is,” Jordan said, calling the proofreading request “unbelievable.”
BrightSource, which received a $1.6 billion loan guarantee, canceled its initial public offering back in April.
Issa said Oversight members will delve deeper into the discovery of BrightSource links with the White House, including having Energy Secretary Steven Chu back before Congress.
“It’s clear that there was direct conversation leading to a form of favoritism for BrightSource,” Issa said.
Kucinich said he doesn’t often share the views of his GOP colleagues, “but I have to say this issue of potential political influence on these loans ought to be looked at.”
To that end, Kucinich held up a letter to Chu from then California Gov. Arnold Schwarzenegger supporting the BrightSource loan. Kucinich argued this was proof that there was bipartisan agreement that BrightSource was a venture worth supporting, and he asked Issa to request that Schwarzenegger come testify.
“I will personally call my dear friend Arnold and invite him,” the Southern California congressman responded, noting that is if Schwarzenegger can get away from his “busy schedule of new movies.”
Issa noted that BrightSource also had hosted a “Friends of Harry Reid” fundraiser at its corporate offices.
“Your company would not exist if it weren’t for loans or mandates,” Issa told Woolard.
Woolard said BrightSource would be operating more outside of the United States if not for the government support. First Solar chairman of the board Mike Ahearn told the committee “we would still be a successful company but we … would not have successfully entered the U.S. energy market.”
“What kind of jet did you fly in on?” Issa asked Ahearn.
Ahearn said it was a Challenger 300, nonstop from Tempe, Ariz.
“Is that really environmentally sensitive?” Issa asked.
This got a grin out of Kucinich. “Seems that the majority is raising a new point of view in regard to the use of corporate jets,” he quipped.
“Dennis, you’ve worn me down over the years,” Issa responded.
Rep. Mick Mulvaney (R-S.C.), a member of the Tea Party Caucus, went off on the execs for lobbying for mandates by which people would have to buy alternative energy products.
“When I was rolling burritos in a restaurant there was nothing that said people have to come to my restaurant and buy my product,” he said. “We’re not here because we don’t want you to be successful. …You have to be here today when you ask us to get involved in your business.”
“I’m tired of people coming to the government as part of their business plan,” Mulvaney continued. “As someone who came from the private sector, I’m sick of it. I wish you would compete on the merits.”