Chu: Solyndra’s collapse doesn’t dent solar investment case

Energy Secretary Steven Chu said Saturday that the bankruptcy of the solar company Solyndra doesn’t undercut the case for continued federal investment in green energy.

“These are really, really big deal things and so if anything happens, you don’t just say ‘oh my gosh, stop everything.’ Nobody does that anywhere in the world, and that is not part of our playbook,” Chu told The Hill.

{mosads}Chu spoke after handing out the top awards at the Solar Decathlon, an Energy Department-backed competition among universities that construct solar-powered homes. (The University of Maryland won.)

Chu said it’s important to “keep our eye in the ball and to focus on those things that are truly important,” noting that the U.S is competing with other nations for leadership in renewable energy industries.

“This is a worldwide race,” he said. Chu has repeatedly warned that the U.S. risks losing the “clean energy race” to China, which is investing heavily, a concern echoed by other renewables advocates.

Chu’s comments to The Hill and public remarks at the Solar Decathlon prize ceremony likely preview his defense of Energy Department loan programs should he testify before congressional panels probing the Solyndra loan guarantee.

Chu is tentatively slated to appear before a House Energy and Commerce Committee panel in coming weeks.

Solyndra collapsed in late August despite receiving a $535 million DOE guarantee in 2009, and Solyndra is now the focus of multiple probes by congressional panels and the FBI. 

The FBI is reviewing whether the company committed accounting fraud, Bloomberg reported Friday.

More broadly, many Republicans are using Solyndra’s failure to make the case against green energy financing programs they say amount to “picking winners and losers” in the market.

Chu, in his remarks at Solar Decathlon ceremony in Washington’s West Potomac Park didn’t mention Solyndra. But he defended the need to invest in both renewable power generation projects and manufacture of green energy equipment.

“It’s not enough for our country to invent clean energy technologies – we have to make them and use them, too. Invented in America, made in America and sold around the world – that’s how we’ll create good jobs and lead in the 21st century,” he said, noting the emergence of a multi-trillion dollar market in coming decades for production of solar panels and other equipment.

The Solyndra controversy recently led Rep. Cliff Stearns (R-Fla.), who is spearheading a House probe of Solyndra, to call for the firing of Jonathan Silver, head of the Energy Department’s loan programs office. 

Silver came aboard after Solyndra was granted its loan guarantee, but critics have faulted DOE management of the financing in addition to criticizing the initial loan decision.

But DOE spokesman Damien LaVera told The Hill that Silver won’t be sacked. 

“The answer is no,” he said when asked whether Silver would be fired.

Critics of the Solyndra deal are focusing in particular on the restructuring of Solyndra’s loan agreement in early 2011, when the company was struggling to stay in business. 

The revision put private investors – who agreed to pitch in an additional $75 million – ahead of taxpayers for repayment if the company collapsed. 

But the Energy Department has defended the restructuring, arguing it put the government in a better chance of repayment than if the company had gone bankrupt in late 2010. 

Department officials say they faced a choice between letting the company collapse imminently, or helping it succeed in the highly competitive solar panel marketplace.

Chu signed-off on the loan restructuring, LaVera said. 

LaVera said Saturday that this is standard procedure.

“When the career loan program staff recommends a transaction for a conditional commitment, closing or restructuring, the Secretary must give final approval – but only after extensive and rigorous analysis by teams of career federal employees and outside experts of the risks and benefits,” he said in a statement.

“These transactions get months, and in some cases years, of exhaustive review, but there will always be an element of risk when America seeks to win an intense global competition for the innovative, job creating technologies of the future,” LaVera said.

DOE approved more than $4.7 billion in loan guarantees for four solar projects Friday.