The House passed legislation on Friday that would phase out a Department of Energy loan guarantee program for clean and renewable energy projects.
On a 245 to 161 vote, lawmakers passed the No More Solyndras Act, named for the solar panel manufacturer that declared bankruptcy in 2011, shortly after receiving a $535 million loan guarantee from the Obama administration. Twenty-two Democrats joined Republicans in passing the measure, while four Republicans sided with Democrats in opposing it. The Senate, controlled by Democrats, is unlikely to consider the bill.
Republicans and Mitt Romney, the party’s presidential nominee, have pointed to the Obama administration’s failed investment in Solyndra as an example of a costly decision pushed by a politically driven White House. After more than a year of investigations and hearings about Solyndra and the loan guarantee program, they argued that the bill passed on Friday was necessary to protect taxpayers from risky investments.
“Solyndra is the most visible but far from the only example,” said Representative Fred Upton of Michigan, the chairman of the Energy and Commerce Committee and one of the authors of the bill along with Representative Cliff Stearns of Florida. “Developing new energy sources and technologies is an important part of our all-of-the-above approach, but it is clear that this loan guarantee program is ineffective at best, and counterproductive at worst.”
The bill would prohibit energy officials from considering applications for loan guarantees filed after 2011. Applications submitted before 2012 would have to be vetted by the Treasury Department before approval. The Department of Energy would also have to provide more information to Congress, and could not allow taxpayer funds to be subordinated when troubled loans are restructured.
Democrats dismissed the vote on Friday as a political move to keep Solyndra in the news. They said Republicans were ignoring the successes of the loan guarantee program.
“This is not serious legislation, it’s a political bill,” said Representative Henry Waxman, the ranking Democrat on the committee. “They’ve been dancing on the grave of Solyndra for so long. Enough is enough.”
Before Solyndra went bankrupt, President Obama used the company’s success to promote his economic agenda, though the initial loan guarantee application was vetted by the administration of former President George W. Bush.
The Energy Department’s loan guarantee to Solyndra led the Treasury to loan the company $535 million shortly before the company filed for bankruptcy last year.
“It is amazing to me that the administration gave a half-billion dollar loan guarantee to a company that its own experts predicted would fail,” Mr. Upton said. Solyndra, he said, was “so dysfunctional that it burned through this giant handout and went bankrupt in two years.”
Without denying Solyndra’s failure, Democrats rejected Republican accusations written into the bill that stated that the decision to approve Solyndra’s loan guarantee was politically driven.
Representative Diana DeGette of Colorado, the ranking Democrat on the energy panel’s Subcommittee on Oversight and Investigations, offered an amendment that would have defended officials’ handling of the loan guarantee application. It was rejected.
“The facts simply do not support the over-the-top allegations that there was anything wrong with this decision,” Ms. DeGette said.
“What the evidence showed is that the career officials and the Bush and Obama administration appointees who worked on the loan told our investigators that political considerations played no role in the decisions on Solyndra,” she said.
The bill had earlier received support from conservative policy organizations like the Heritage Foundation and Taxpayers for Common Sense, who praised the effort as a step toward federal energy subsidies. But those groups relaxed or withdrew their support for the final bill on Thursday because it would still allow about 50 projects to move forward, potentially costing taxpayers more than the Solyndra failure.
Opponents of the bill said it would take government out of innovation and unfairly preserved loan guarantees for nuclear and fossil fuel projects.