Government program earning money. Republicans pissed.

[someoneyouknow]

Everyone here should remember Solyndra which defaulted on a $535 million loan from the Department of Energy. People wondered if politics was involved in the loan and Republicans, of course, whined up a storm about how awful it was and they wanted investigations and so on.

As the following story relates, when the program was developed in 2005 (under the Bush Administration it should be noted) Congress never expected to turn a profit and set aside money for the expected losses.

However, an odd thing happened, the program got back all that it lost on Solyndra and then some, turning in a $30 million profit.

When asked to comment on the current success of the program, those same Republicans who were so upset about the Solyndra loss refused comment or didn't bother to answer repeated requests.

http://www.npr.org/2014/11/13/363572151/after-solyndra-loss-u-s-energy-loan-program-turning-a-profit (The story is in audio format)

 

[ms_ann_thrope]

Could you please cut & paste. Thanks in advance.

 

[Mello_SixtyNine]

The government should not be picking winners and losers, that's Crony Capitalism. Had those Solyndra executives not donated heavily to Obama's election campaign, they would not have received that half billion that was squandered.

 

[someoneyouknow]

Could you please cut & paste. Thanks in advance.

It's in audio format (thus my note after the link). It's the broadcast of the radio segment but here goes:

In 2011, solar panel company Solyndra defaulted on a $535 million loan guaranteed by the Department of Energy. The agency had a few other high-profile bankruptcies, too — electric car company Fisker and solar company Abound among them. But now that loan program has started turning a profit.

Overall, the agency has loaned $34.2 billion to a variety of businesses, under a program designed to speed up development of clean-energy technology. Companies have defaulted on $780 million of that — a loss rate of 2.28 percent. The agency also has collected $810 million in interest payments, putting the program $30 million in the black.

When Congress created the loan program under the Energy Policy Act of 2005, it was never designed to be a moneymaker. In fact, Congress imagined there would be losses and set aside $10 billion to cover them.

Still, when the Solyndra case emerged, Republicans on Capitol Hill had pointed criticism for the Obama administration. Rep. Steve Scalise, R-La., called the Solyndra case "disgusting," and Sen. Lisa Murkowski, R-Alaska, labeled it "a colossal failure." The conservative group Americans for Prosperity produced a television ad accusing President Obama of paying back campaign contributors.

There was an FBI raid on Solyndra's headquarters and an investigation but, so far, no prosecutions. Now that the loan program is turning a profit, those critics are silent. They either declined or ignored NPR's requests for comment. And with that, Energy Secretary Ernest Moniz wants to change people's perception of his agency's loan program.

"It literally kick-started the whole utility-scale photovoltaic industry," Moniz says. The program funded the first of five huge solar projects in the West. Moniz says before that, developers couldn't get money from private lenders. But now, with proven business models, they can.

The Energy Department actively monitors all the companies in its portfolio for potential default risks, "and when there are warning flags, then the disbursements are suspended — possibly ended," Moniz says.

But he says the Energy Department doesn't want to go too far in the direction of only lending to safe investments. "We have to be careful that we don't walk away from risk, because otherwise we're not really going to advance the marketplace," he says.

Moniz points to a small company called Beacon Power as an example. It got an Energy Department loan, went bankrupt and defaulted on about $14 million in debt. Today the company is back in business, providing a valuable service to electricity grids and repaying the rest of its loan

In eastern Pennsylvania, one of Beacon's facilities sits on 4 acres in an industrial park. Underground are 200 black flywheels that each measure 7 feet tall and 3 feet around, and weigh 2,000 pounds. They spin faster when storing energy and slow down when releasing it.

"We're recycling excess energy that's on the power grid and then putting it back into the grid when it's needed," explains President and CEO Barry Brits. He says the flywheels are essentially mechanical batteries.

But unlike the battery in your cellphone, the flywheel doesn't wear out over time. "What's unique about the flywheel is that it really is unlimited in terms of the number of times it can charge and discharge," Brits says.

Being able to store electricity is important because wind and solar generators only produce power when the sun is shining and the wind is blowing. That can make life difficult for grid operators who must balance the amount of electricity produced with how much is used. Storing power — even for brief periods — gives them more flexibility and makes it easier to include intermittent forms of renewable generation on the grid.

Brits says the Department of Energy loan allowed his company to test and then improve its flywheels. "Our technology is now well-proven. We have over 7 million operating hours," he says, adding that building a plant costs half of what it did three years ago.

Despite early missteps, the Department of Energy is ready to invest in more projects that could advance clean energy technology in the U.S. Moniz says his agency has about $40 billion to lend in coming years.