Showing posts with label Energy Department. Show all posts
Showing posts with label Energy Department. Show all posts

Thursday, August 27, 2015

[VIDEO] Watchdog: Solyndra Lied to Get Federal Loan Money



Misrepresented facts to get loan guarantee

A four-year investigation has concluded that officials of the solar company Solyndra misrepresented facts and omitted key information in their efforts to get a $535 million loan guarantee from the federal government. 
The company's collapse soon after getting federal backing provided ammunition to lawmakers and other critics who portrayed it as wasteful government spending. The company's failure likely will cost taxpayers more than $500 million. 
The report by the Energy Department's inspector general was released Wednesday. It's designed to provide federal officials with lessons learned as it proceeds to grant billions of dollars in additional loan guarantees. The inspector general found fault with the Department of Energy, describing its due diligence work as "less than fully effective." The report also said department employees felt tremendous pressure to process loan guarantee applications. 
In the end, however, the inspector general said the actions of the Solyndra officials "were at the heart of this matter." 
"In our view, the investigative record suggests that the actions of certain Solyndra officials were, at best, reckless and irresponsible or, at worst, an orchestrated effort to knowingly and intentionally deceive and mislead the department," the IG's report said. 
A federal loan guarantee program for energy projects was established in 2005 during President George W. Bush's administration. Four years later, the Democratic-led Congress passed an economic stimulus bill that substantially expanded the program. In the ensuing two years, the department disbursed more than $500 million to Solyndra, but in September 2011, the company laid off 1,100 employees, ceased operations and filed for bankruptcy protection. Obama personally visited the plant in 2010 to cite it as an example of economic progress stemming from the Democratic-led stimulus bill. 
The IG's report did not provide any response to its findings from a Solyndra representative. Nor did it identify by name any particular Solyndra leader who gave misleading information. Miles Ehrlich, counsel for the company's former CEO, Chris Gronet, disputed the findings. He said the allegations were investigated by three of the most aggressive federal prosecutors in the country, and each time, "they rejected this DOE spin as contrary to the actual facts." 
"Solyndra executives were completely truthful and accurate in their representations during this loan process, and the DOE was never misled about Solyndra's business or prospects," Ehrlich said. 
Ehrlich said the real cause of Solyndra's failure had nothing to do with fraud, but was caused by the unexpected dumping of solar panels subsidized by China's government. 
The report notes that federal prosecutors and the Federal Bureau of Investigation also participated in the interviewing of witnesses and the examination of hundreds of thousands of documents. In early 2015, the Department of Justice informed the inspector general's office that it would not pursue criminal prosecution of any Solyndra officials. 
The inspector general's report said the department relied on third-party evaluations for part of its analysis of Solyndra. In one case, an engineering firm, R.W. Beck, Inc., issued a report on the solar panel market relying on company representations that it had $1.4 billion in revenue under contract through 2012. The report said Solyndra's "firm" sales contracts supported its financial model. But, by the time Beck issued its final report, all four of Solyndra's customers had been offered price concessions. 
"Solyndra's failure to directly disclose these significant material changes in its contractual relationships distorted the view the department and its consultants had of the market for Solyndra's products," the inspector general said. 
Solyndra was also required to hire an outside firm, Fitch Ratings Inc., to prepare a credit assessment of the project, located in Fremont, Calif. A Fitch official told investigators that he asked Solyndra if any contract customers had received price concessions and was told no. Additionally, the company's largest customer had informed the company it would not buy more panels in 2009 because Solyndra's price was too high. A Fitch official told investigators that if it had been aware of price concessions it would have assigned Solyndra a lower credit rating. 
The report was less detailed about the Energy Department's shortcomings in conducting due diligence. It said the department needed to consider using "new and more intrusive validation techniques." It also said consultants the department hires must be held accountable for their work. 
Solyndra's failure was the subject of numerous congressional hearings and a report from Republicans on the House Energy and Commerce Committee. The August 2012 report concluded that Solyndra was a cautionary tale on how political pressures and other factors can result in poor decision-making. 
"The red flags about Solyndra's financial condition and the turbulence in the solar market were there for DOE to see when it reviewed Solyndra's application in 2009. DOE staff and (Office of Management and Budget) staff noted these concerns at the time the loan guarantee was under consideration," the congressional report concluded.

Friday, August 7, 2015

Cronyism Lawsuit Against Energy Department’s $25 Billion Green Energy Program Advances

Tesla Model S Sedan
A federal judge in Washington, D.C., has ruled that a lawsuit filed by a government watchdog group against the Department of Energy over “political favoritism” within a multi-billion dollar federal green energy loan program can advance.
Cause of Action, a nonpartisan watchdog group, submitted the lawsuit against the DOE arguing the agency awarded loans to companies based on political connections and donations while denying money to similar companies who do not have the same political clout.
The DOE program in question, the $25 billion Advanced Vehicle Manufacturing Loan Program, was created in 2008 with the intent of supporting the development of energy-efficient cars. The group submitted the lawsuit on behalf of the now dissolved XP Vehicles and Limnia—a former California vehicle company.
Within the complaint, which was initially filed on Nov. 14, 2012, in the U.S. Court of Federal Claims, XP alleges “corruption and negligence” pervaded the Department of Energy’s decision to award loan guarantees to Nissan, Ford, Tesla Motors, and Fisker Automotive for the development of electric vehicle technology.
“When politicians and agencies allow companies to purchase government access, the basic foundation of our free market economy is compromised,” Dan Epstein, president of Cause of Action, told the Washington Free Beacon.
Epstein elaborated on this point in a recent op-ed published in The Hill.
Epstein notes Tesla Motors—one of the companies awarded money from the Advanced Vehicle Manufacturing Loan Program—had plenty of connections and access to give them an advantage over a company such as XP Vehicles.
Tesla’s founder, Elon Musk, was a maxed out donor to President Obama. Steven Westly, a board member of Tesla, was appointed to a Department of Energy advisory board. Additionally, an investor and adviser of Tesla, Steven Spinner, served as a program analyst at the Department of Energy from 2009 to 2010. Spinner helped monitor the issuance of the $25 billion coming from the program.
Another beneficiary of the program, Fisker Automotive, also had high-dollar donors to President Obama.
Fisker was backed by a San Francisco-based venture capital firm whose senior advisers donatedmillions to Democrats during the 2008 election cycle, including Obama. John Doerr, a partner of the group, later secured a seat on the President’s Council of Jobs and Competitiveness and helped Fisker land $192 million in government energy loans. The company has since gone bankrupt.
XP Vehicles and Limnia, on the other hand, were rejected twice by the Department of Energy for what Epstein says are “bogus reasons” despite being similar to other companies who received federal money to aid the manufacturing of energy-efficient cars.
“For starters, the department made claims that were laughably false. To take one example: It rejected XPV’s application because its vehicle was powered by hydrogen. It was an electric SUV. It also raised objections that it didn’t raise with other companies whose applications were approved,” Epstein wrote. “For instance: The bureaucracy criticized the proposed all-electric vehicle for not using a specific type of gasoline. Yet Tesla and Fisker received the loans despite producing similar all-electric cars.”
As a result, XP Vehicles could not compete with the other heavily subsidized companies and has since gone out of business.
Epstein called the recent ruling by a federal district court that allows his lawsuit to advance “groundbreaking” and a victory for individuals and businesses everywhere.
“For the first time, a federal district court has confirmed there is a legal remedy when cronyism influences federal administrative discretionary spending,” Epstein told the Free Beacon. “This groundbreaking opinion establishes that the government owes everyone—not just presidential campaign donors—a fair shake when awarding government funds.”
“Judge Ketanji Brown Jackson’s common-sense judgment that government decisions tainted by cronyism and political favoritism are ‘arbitrary and capricious’ is a victory for individuals and businesses everywhere.”

Tuesday, April 21, 2015

White House sneaks out two new climate-related programs

The Obama administration snuck in two new climate change-related programs when it rolled out a major new study on the nation's challenged energy system.
Photo - President Obama is slated to visit the Everglades on Wednesday to discuss his climate change strategy. (AP Photo) The first installment of a major four-part energy analysis, dubbed the Quadrennial Energy Review, was issued Tuesday morning after several months of persistent delays. Included with the 350-page review, which focused on the nation's energy infrastructure hurdles, were two new executive actions: one addressing climate change resilience, and another for clean energy improvements in rural America.
The administration hinted that the new initiatives may be part of a speech the president plans to deliver Wednesday in Florida on climate change.
The Energy Department will lead a climate change resilience partnership with a mix of the largest municipal, investor-owned and rural cooperative utilities in the country to address the energy problems caused by global warming.
Many scientists say that manmade emissions from the burning of fossil fuels is causing the Earth's climate to warm, resulting in extreme weather, flooding and drought. The increase in severe weather and its effect on electricity infrastructure is what the "Partnership for Energy Sector Climate Resilience" will examine, according to the White House.
In a fact sheet elaborating on the Quadrennial Energy Review, the White House says the new partnership will ramp up quickly. The first meeting is slated for April 30.
The partnership will comprise of 17 companies and the Energy Department. The fact sheet says it "will improve U.S. energy infrastructure resilience against extreme weather and climate change impacts with the leading providers of electricity services."

Saturday, November 23, 2013

Taxpayers lose $139 million on Fisker Automotive loan

Taxpayers lose $139 million on Fisker Automotive loan
Happy Thanksgiving from the Obama administration. The Energy Department has sold off its $192 million loan guarantee to Fisker Automotive to Chinese billionaire Richard Li for $25 million — the biggest taxpayer loss on a green loan since the failure of Solyndra.
The Energy Department will announce the “selling of the promissory note” to Hybrid Tech, which is owned by Chinese billionaire Richard Li, according to sources familiar with the sale. The DOE sold the loan to Li for $25 million after lending the financially troubled green automaker a total of $192 million since 2009.
“Once again, American taxpayers are losing out to foreign investors due to the Obama administration’s failed green energy policies. Time after time this administration has fumbled the ball with their attempts to pick winners and losers when it comes to American energy,” House Energy and Commerce Committee vice chairman Marsha Blackburn, a Tennessee Republican, said in a statement to The Daily Caller News Foundation.
“As a result of President Obama’s misguided policies, the Department of Energy Loan Guarantee program is quickly becoming a highly utilized stimulus program for foreign investors,” she added.
Via: Daily Caller

Continue Reading.....

Thursday, September 19, 2013

OIL DROPS AS FED EUPHORIA FADES; GAS BELOW $3.50

AVERAGE PRICE IN CALIFORNIA FOR GALLON OF GAS IS OVER $4.00

NEW YORK (AP) -- The price of oil fell Thursday as excitement faded over the U.S. Federal Reserve's decision to keep its monetary stimulus in place.

Benchmark oil for October delivery dropped $1.68, or 1.6 percent, to close at $106.39 a barrel on the New York Mercantile Exchange.

A day earlier, oil rose 2.5 percent after the Fed unexpectedly maintained its stimulus for the U.S. economy and the Energy Department reported a bigger than expected drop in supplies of crude oil and gasoline.

Meanwhile, most U.S. drivers are seeing lower prices at the gas pump. The nationwide average for a gallon of gasoline dropped below $3.50 for the first time since July 9. At $3.49 a gallon, the average is down 6 cents from a week ago. However, Californians aren't sharing in the relief. They're paying about 7 cents more on average than a week ago, due to unplanned maintenance at some refineries.


Saturday, November 17, 2012

Two More Stimulus-Backed Solar Companies Announce Layoffs


A pair of foreign-owned solar companies that benefited from a combined $84 million in Energy Department tax credits have announced they will lay off employees.
One of the companies, German-owned SolarWorld, was integral in the fight for tariffs against the importation of Chinese photovoltaic solar panels. The other, Chinese company SunTech, blamed those tariffs for its own layoffs.
Both companies benefited from the Energy Department’s stimulus-funded Advanced Energy Manufacturing (48C) Tax Credit. The 48C credit is worth up to 30% of the cost of manufacturing qualifying green energy projects.
Both companies announced this week that they will shed some employees. SolarWorld, which announced a 47% revenue decline in the third quarter, blamed a potential 37 layoffs at its Oregon plant on “illegal” Chinese trade practices.
SunTech said the U.S. International Trade Commission’s 35.95% tariff on Chinese solar panels was partially responsible for the 50 impending layoffs at its Arizona production facilities.
While heavy Chinese subsidies do reduce the cost of solar panels from that country, Heritage’s Derek Scissors warned against replicating those policies in testimonybefore the Senate Energy and Natural Resources Committee in June.
“The U.S. boasts a far better energy and environmental record than China,” Scissors explained, “and moving in China’s direction would be very risky.”
SunTech and SolarWorld are the latest additions to a long list of taxpayer-backed green energy companies that have gone bankrupt, laid off workers, or otherwise hit dire financial straits.

Thursday, October 25, 2012

Another Reason Why America Is Amazing ...

U.S. May Overtake Saudi Arabia As World’s Top Oil Producer
NEW YORK (AP) - U.S. oil output is surging so fast that the United States could soon overtake Saudi Arabia as the world's biggest producer.
Driven by high prices and new drilling methods, U.S. production of crude and other liquid hydrocarbons is on track to rise 7 percent this year to an average of 10.9 million barrels per day. This will be the fourth straight year of crude increases and the biggest single-year gain since 1951.
The boom has surprised even the experts.
"Five years ago, if I or anyone had predicted today's production growth, people would have thought we were crazy," says Jim Burkhard, head of oil markets research at IHS CERA, an energy consulting firm.
The Energy Department forecasts that U.S. production of crude and other liquid hydrocarbons, which includes biofuels, will average 11.4 million barrels per day next year. That would be a record for the U.S. and just below Saudi Arabia's output of 11.6 million barrels. Citibank forecasts U.S. production could reach 13 million to 15 million barrels per day by 2020, helping to make North America "the new Middle East."
The last year the U.S. was the world's largest producer was 2002, after the Saudis drastically cut production because of low oil prices in the aftermath of 9/11. Since then, the Saudis and the Russians have been the world leaders.
The United States will still need to import lots of oil in the years ahead. Americans use 18.7 million barrels per day. But thanks to the growth in domestic production and the improving fuel efficiency of the nation's cars and trucks, imports could fall by half by the end of the decade.
The increase in production hasn't translated to cheaper gasoline at the pump, and prices are expected to stay relatively high for the next few years because of growing demand for oil in developing nations and political instability in the Middle East and North Africa.

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