Congress is back in session after a long summer break. And the first order of business in the House of Representatives is to pass the “No More Solyndras” Act, a bill designed to squash the Department of Energy’s embattled loan guarantee program for innovative clean energy projects.

But here’s something you won’t likely hear from lawmakers: Experience on the ground shows that the loan guarantee program is working as designed.

Partly boosted by the construction of large-scale solar projects supported by loan guarantees, the U.S. solar photovoltaic market is on track for a third consecutive year of triple-digit growth.

U.S. solar developers installed 742 megawatts of solar PV in the second quarter of 2012. And if growth continues, the industry could install more than 3,000 megawatts of projects this year, according to a new market report from GTM Research and the Solar Energy Industries Association.

While residential installations were flat and commercial installations dipped in Q2 of this year, utility-scale projects grew substantially. Two projects partly responsible for the boost — the 290-MW Agua Caliente project in Arizona and the 170-MW Mesquite project — received loan guarantees through the DOE. Neither project is fully complete yet, but both had phases come online this year. A third project, the 50-MW Silver State solar plant, was fast-tracked by the Interior Department and became the first large-scale solar facility to be developed on public lands.

If it were not for the growth in large-scale projects, the solar market would have declined by 18 percent rather than grow by 45 percent in the second quarter, according to the report.

Much of the political attention to loan guarantees has been focused on a few high-risk technology companies that went bankrupt (Abound Solar, Beacon Power, Solyndra); however, the majority of projects supported by the program were for large-scale power generation and fuel production. The loan guarantees were designed to help leverage private capital to finance these facilities during the economic downturn when private investors were wary of deploying capital. It worked. And today, dozens of “first-of-a-kind” projects are under construction or completed, helping boost America’s share of renewable energy.

In fact, because the loan guarantee program supported mostly generation projects with long-term contracts, analysis has found that it will cost taxpayers $2 billion less than initially expected.

Unfortunately, this story will likely be ignored by opponents still intent on politicizing Solyndra.

Related Posts:

• Five Things You Should Know About Solyndra During The 2012 Campaign
• Breaking News Stunner: DOE Loan Guarantee Program Will Cost $2 Billion Less Than Initially Expected
• Renewable Electricity Nearly Doubles Under Obama: ‘I Think They’re The Future. They’re Worth Fighting For’

by Bracken Hendricks and Adam James

Question: What is the Department of Energy doing to address the fact that American homeowners and businesses spend about $300 billion on energy bills per year?

Answer: Helping the private sector to create new markets that provide thousands of workers with paychecks, and launch innovative new business models for capturing energy efficiency.

The Better Buildings Neighborhoods program, formerly known as the “Retrofit Ramp-Up,” was launched in April of 2010 with the aim of jumpstarting state and locally based energy efficiency programs using Recovery Act grants as one-time seed funding. To date, $508 million in grant funding has gone out to 41 different programs, serving hundreds of communities nationwide.

The 2009 “Recovery through Retrofit” report spearheaded by Vice President Biden and the White House Council on Environmental Quality identified several key barriers that have slowed the growth of a residential energy efficiency market. These barriers to scale include:

• Access to Information: Average consumers rarely have easy and understandable data about their home’s energy usage, the return-on-investment for upgrades, or the various options available to them.
• Access to Financing: A lot of energy efficient upgrades make good financial sense over the long run, but the up-front capital costs are intimidating. Financing can soften the blow and space payments out over a period of time which mirrors the way consumers see energy bills.
• Access to Skilled Workers: Despite large numbers of construction workers being out of work, the pool of skilled labor is constrained. This can be traced to a lack of demand for these services. Who stakes their livelihood where a solid market doesn’t yet exist?

With these barriers in mind, the Better Buildings Neighborhoods programs set out to create the conditions for a scalable energy efficiency market. Their approach: strategic and creative use of ARRA grant funds as seed money (requiring recipients to leverage private capital 3:1) to get programs off the ground, build constituencies and stakeholders for these programs, and extract lessons learned to inform future program design.

Halfway through the funding and about two thirds of the way through its lifetime, the program has already demonstrated important success.

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Rep. Cliff Stearns (R-FL) supports eliminating the Department of Energy (DOE), because the employees get to take off holidays like Presidents’ Day. Leader of an expensive witch hunt of the department’s support for renewable energy, Stearns has previously called for the firing of the Nobel-winning Secretary of Energy Steven Chu. At the same February 25 town hall meeting where he questioned Obama’s birth certificate, Stearns agreed with a constituent who called for the abolition of the nation’s nuclear, fossil, and clean-energy brain trust:

STEARNS: It seems to me we could take one — The Department of Energy is one that I feel we should probably cut their budget in half.

AUDIENCE MEMBER: No! We ought to get rid of it! Get rid of it! Don’t cut it, get rid of it!

STEARNS: I’ve asked for it. And I’m on a bill to get rid of it. You see, in public I try to be a little bit — but the Department of Energy was not — before Jimmy Carter we didn’t have a Department of Energy. Now we have this Department of Energy, it does about $30 billion in revenues we give them. And what are they doing to make us energy independent? And they’ve got thousands and thousands of employees. Every one of you would like to have one of their jobs. They start anywhere from 50 to 75,000 dollars. You’ve got a thrift savings account. You’ve got health care. You’ve got — You get off all these legal holidays. Presidents’ Day. I mean when I operated my motels and restaurants I never had a day off Presidents’ Day, or Lincoln Day. I never got any of these days off. I gave Christmas off probably, but even Christmas if a desk clerk got pulled I had to come in and help. I never got any of these days off. So I agree with you on the Department of Energy.

Watch it:

Stearns is correct that DOE employees get health care and national holidays. They include nuclear physicists, economists, mathematicians, and engineers, who could demand considerably higher salaries in the private sector working for oil companies or defense contractors. Under Republican rule, the House of Representatives — whose membership includes only 9 scientists and engineers — is only working 109 days this year.

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In an independent review, John McCain’s former National Finance Chairman finds the loan guarantee program was cost-effective for taxpayers

by Richard W. Caperton

Take a deep breath, because what I’m about to tell you may be shocking: loan guarantees for energy have been successful, cost-effective investments.

That’s the message from Herb Allison, former national finance chairman for John McCain, who led a team of accountants and auditors in conducting an independent analysis of the Department of Energy’s Loan Guarantee Program.  Allison and his team found that, despite the hysteria around Solyndra, this program will cost $2 billion less than initially expected.

Today, the White House released Allison’s review.  It includes an analysis of every loan guarantee issued from DOE, as well as recommendations for managing this portfolio of guarantees going forward.  This independent review was requested by the White House in late 2011, to make sure that the DOE loan guarantee portfolio was cost-effective for taxpayers.

The Allison review confirms what we already know, thanks to the Congressional Research Service and Bloomberg Government.  Instead of looking at individual investments, CRS examined the entire DOE portfolio, and concluded that the overwhelming majority of the portfolio was in electrical generation projects, which DOE structured to have very low risk.  Bloomberg Government took that a step forward, and concluded that the media’s incessant focus on Solyndra was “not proportional to its impact.”

There are multiple reasons why the risks to taxpayers from this program are so low.  First, most of the guarantees went to support projects that have very secure contracts to sell their power to investment-grade rated utilities. Allison and his team of independent auditors endorsed the methodology that DOE initially used to evaluate these types of projects, writing, “The Independent Consultant used the same Nine Criteria as did DOE because, in the opinion of the Independent Consultant, they comprise the salient factors for evaluating the credits and are substantially similar to the criteria that would be employed by private sector credit analysts for these types of loans.”

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At today’s House hearing on the Solyndra loan guarantee, Energy and Commerce Committee Chairman Fred Upton questioned Energy Secretary Steven Chu on the decision to approve financial backing of the now-bankrupt solar manufacturer.

Upton lamented the “red flags” that outside parties were raising about the viability of Solyndra in 2009 when the loan guarantee was issued, wondering if those concerns were “either ignored or minimized by senior officials.”

However, during the exact same time period when the Solyndra loan guarantee was being reviewed, Upton asked the DOE to approve a loan guarantee to a Michigan-based solar manufacturer — just months after the company stopped production at its plant and two weeks after announcing it would lay off 400 workers. The company, Uni-Solar, manufactures flexible amorphous-silicon thin film solar materials that be applied to a variety of surfaces.

The Washington Post reports on Upton’s letter to the DOE, co-written with a bi-partisan group of lawmakers, which asked the agency to consider backing Uni-Solar, even while its parent company, Energy Conversion Devices, was publicly facing problems:

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JR:  Obama apparently has to go to Australia to talk about the reality of climate change and the benefits of carbon pricing and emissions reductions.

AP Pool Photo

Obama: Slashing carbon emissions is ‘good for our economies’

President Obama said Wednesday that policies to curb carbon emissions bring economic benefits but acknowledged that crafting an international deal that imposes commitments on China and India will be a “tough slog.”

Obama, at a press conference with Australian Prime Minister Julia Gillard, touted U.S. policies including increased auto efficiency standards and green energy research investments.

“As we move forward over the next several years, my hope is, is that the United States, as one of several countries with a big carbon footprint, can find further ways to reduce our carbon emissions,” Obama said in Canberra, Australia.

“I think that’s good for the world. I actually think, over the long term, it’s good for our economies as well, because it’s my strong belief that industries, utilities, individual consumers – we’re all going to have to adapt how we use energy and how we think about carbon,” Obama added, according to a White House transcript.

JR:  Ya think? Here’s more from Obama, including his strongest remarks on climate in a long time:

CLICK HERE TO READ MORE OR COMMENT

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by Shauna Theel, in a Media Matters cross-post

As the political jostling over Department of Energy loan guarantees to clean energy companies continues, the hypocrisy keeps getting worse.

The latest is from Republican Pennsylvania Senator Pat Toomey, who co-wrote a letter to the Inspector General on Monday urging him to investigate a conditional commitment for a $730 million loan guarantee to a high-strength steel producer under the DOE’s Advanced Technology Vehicle Manufacturing program.

His argument? That this high-strength, lightweight steel technology is too mature to need subsidies:

“Given the tremendous fiscal crisis that we find ourselves in today, it does not seem appropriate for the program to subsidize technologies that have already achieved commercial success through private-sector means.”

That’s quite a noble fiscal mission. However, this is coming from a Senator who has repeatedly voted to maintain tax breaks to the most profitable and commercially successful oil and gas companies in the world.

In the first three quarters of 2011 alone, the top five oil companies have brought in a staggering $101 billion in profits. But Senator Toomey, who says he’s against funding companies that have “achieved commercial success” due to the “tremendous fiscal crisis” has voted against repealing $21 billion in tax breaks over 10 years that could be used to close the deficit or fund clean energy.

In fact, Senator Toomey’s record has been so consistent, the American Petroleum Institute just issued a new ad praising him on his record:

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