WASHINGTON, Sept 14 (Reuters) - The Obama Administration
missed signs of financial trouble at solar panel maker Solyndra
as it rushed to award the now-bankrupt company a loan of nearly
$535 million in time for a groundbreaking event with the White
House, Republican lawmakers said on Wednesday.
Solyndra LLC's bankruptcy and ensuing criminal
investigation into the California-based company has sparked
outrage over administration efforts to spark a clean energy
industry and create jobs through stimulus spending.
Here is a list of companies that have been offered
conditional Department of Energy loan guarantees:
Republicans who investigated the loan released documents at
a House hearing, saying they found political pressure may have
caused officials "to miss or disregard numerous shortcomings
regarding Solyndra's financial viability."
E-mails and documents "raise troubling questions" about
whether the Office of Management and Budget rushed to complete
its loan review in time for a September 2009 groundbreaking at
Solyndra scheduled with Vice President Joe Biden and others,
congressional investigators said in the report.
"These documents raise questions as to whether the Solyndra
loan guarantee was pushed to approval before it was ready in
order for the administration to highlight the stimulus, and
whether additional time might have resulted in stronger
mitigation of the risks presented by the deal," it said.
The White House denied it pressured budget officials to
accelerate approval of the $535 million federal loan guarantee
for Solyndra in 2009.
"What the emails, I believe, made clear is that there was
urgency to make a decision about a scheduling matter," White
House spokesman Jay Carney told reporters aboard Air Force One
on a flight to North Carolina.
"It is a big proposition to move the president or to put on
an event and that sort of thing. So people were simply looking
for answers about whether or not we could move forward," Carney
said.
Jonathan Silver, who heads the energy department's loan
guarantee program, said the loan was not rushed and was based
on "several years of due diligence." He told the House Energy
and Commerce's oversight and investigations panel the loan was
granted based on merits, not political pressure or favoritism.
Silver told lawmakers the administration has no intention
of "walking away" from other renewable energy projects.
"While we are all disappointed in the outcome, securing
America's leadership in this vital new industry requires that
we support innovation and deployment," he said.
"I can't imagine a scenario in which we would willingly as
a country walk away from what would be undoubtedly one of the
largest if not the largest industries in the world over the
next several decades," said Silver.
Republicans charged the DOE may have violated a 2005
federal law when it restructured Solyndra's loan guarantee last
year. Under terms of the restructuring, an emergency $75
million private loan provided to Solyndra at the time is first
in line to be repaid, ahead of the government's federal loans.
When questioned about the decision to restructure the loan
Silver and Jeffrey Zients, deputy director at OMB, defended the
move. It was "a reasonable decision" at that time, said
Zients.
"ONE BAD BET?"
Republicans questioned the competency of the loan program
and ability of the department to effectively distribute another
$10 billion in loan guarantees to green technology companies
before a Sept. 30 deadline.
"Was Solyndra just one bad bet by an administration rushing
to claim credit for the loan guarantee or is it the tip of the
iceberg?" asked Fred Upton, the chairman of the House Energy
and Commerce Committee."
"If the administration was so wrong about Solyndra after
nine months of due diligence how can it possibly exercise the
proper controls when doling out another $10 billion in the next
couple of weeks?" he asked.
During a visit to its manufacturing facility last year,
President Barack Obama praised the company for its technology,
making Solyndra a centerpiece of efforts to stimulate the
economy and create green jobs.
The California solar-panel maker, citing international
competitions, filed for Chapter 11 bankruptcy protection last
week. FBI agents searched the company's offices two days later,
in a possible probe of the federal loan guarantees.
The U.S. Department of Energy created the loan program for
green energy projects under the Bush Administration in 2005,
but the first loan guarantee wasn't extended until four years
later when the loan office received stimulus funding.
The loan guarantee received by the solar-power panel maker
was the first awarded under the program to support innovative
green technologies.
Representative Cliff Stearns, who heads the oversight and
investigations panel, told reporters lawmakers are reviewing
information and trying to obtain more details from the
administration and others showing the relationship between the
White House, the Energy Department, Solyndra and investors in
the company and whether there were any signs of influence.
Ultimately, he said people should be fired.
"You're going to have to go to the top people and say why
did this happen," said Stearns. "You can't lose this kind of
money and have the FBI indicate there's criminal activity and
not have somebody fired."
Solyndra's top executives were invited to testify before
the subcommittee on Wednesday, but they will now appear next
Friday. Stearns indicated Energy Secretary Steven Chu also may
be asked to testify.
Solyndra is the third U.S. solar firm to declare bankruptcy
in recent weeks. Tumbling prices on solar panels worldwide have
hit profits at industry heavyweights such as China's Suntech
Power Holdings Co Ltd and U.S.-based First Solar Inc this year.
Small, up-and-coming solar companies have found it increasingly
difficult to stay afloat.
The bankruptcy case is Solyndra LLC, Case, U.S. Bankruptcy
Court, District of Delaware, No. 11-12799.
For Solyndra: Bruce Grohsgal of Pachulski Stang Ziehl &
Jones.
(Reporting by Christopher Doering; Additional reporting by
Nichola Groom)
Follow us on Twitter: @ReutersLegal