This stupid Solyndra circus is starting to remind me of the late 1990s, when any whiff of scandal was like catnip to the media. This is 1/80th of the total price of loans made from the Energy Department’s program, none of the other companies involved have failed, and yet this is supposed to be an object lesson in how green jobs cannot compete. Never mind the $40 billion in subsidies given to oil and gas companies or the hundreds of millions in loan guarantees propping up the nuclear industry. This notion of a free market in energy is ridiculous.
In just the last two months, about 7,000 megawatts of new solar projects were added to the U.S. pipeline. That’s the equivalent of seven nuclear reactors, which is seven more than we’ve built in the last three decades. And that doesn’t include residential projects, like the unprecedented “Solar Strong” effort to install photovoltaic panels on 160,000 rooftops on military housing that was just announced last week. The U.S. solar market doubled last year, and it’s expected to double again this year, even though many states are reducing their subsidies. How many other industries are growing that fast in this economy?
Like every other U.S. energy source, solar is federally subsidized. The loan guarantee program has been a particularly crucial driver for unusually large or innovative projects, like Project Solar Strong or a 250-megawatt solar generation plant in the Mojave Desert that just finalized a $1.2 billion loan guarantee on Tuesday, and will provide clean renewable power for more than 50,000 homes. Last week, the Obama administration approved a $150 million loan guarantee to 1366 Technologies, a Massachusetts firm with a new manufacturing process that could cut the cost of silicon wafers 50% and make solar even more cost-competitive.
Grunwald also mentions that the Energy Department has a reserve fund in the loan guarantee program to cover the costs of loans that don’t pan out, so this Solyndra loan won’t cost taxpayers a dime.
The solar industry has several moving parts, from solar panel manufacturers like Solyndra, to installation firms (which are all domestic jobs that cannot be outsourced), to technology and innovation. The manufacturing sector has been pummeled by cheap imports from China, thanks mostly to the $30 billion infusion from the Chinese government into that industry. Has the greentech loans from DoE created the jobs that were advertised? Maybe it was oversold, but I think it’s way too early to make that definitive a statement, and anyway the jobs that a robust solar industry supports aren’t factored into the equation.
Moreover, the world is moving to solar and wind, and we can move with it or allow a bunch of conservative lawmakers funded by the dirty energy sector to hold us back. Wind employs more people than coal. Solar will be cheaper than coal in a matter of years.
Dave Johnson has the most comprehensive debunk of the Solyndra “scandal.” And this is important:
Even though Solyndra went into bankruptcy the government didn’t “lose.” The purpose of the government’s involvement was to help trigger the development of green-energy manufacturing in the United States, not to help individual companies. This was not a direct investment in a company with the expectation of a profit for the government. In the bigger picture of promoting American leadership in the emerging green-energy industry the government’s loan guarantee was a success. Even though Solyndra’s investors lost out our country retains the trained skilled employees, the intellectual property, the innovators funded, the suppliers, and the factory. As components of a national effort to trigger a key strategic industry, those are all still there and in the US.
It isn’t the government’s job to make sure the investors make money, the government’s job is to work to keep all of these components of an industry here and to grow new ones here, and this is what has been accomplished. When a VC makes an investment, a company failing just goes on the books as a loss. But our government has succeeded even if Solyndra’s investors lost money because the country as a whole benefits. All these employees are trained, all the researchers can take what they know to other solar companies, the IP is going to be sold — and it should be part of the conditions that it be sold to an American company. So while Solyndra’s for-profit investors lost money, America’s larger effort to nurture a solar-power industry continues toward its goal with assets enabled by this loan guarantee.