The Obama Administration has no intention of walking away from investing in renewable energy projects despite the bankruptcy of a high-profile solar panel maker backed by federal loan guarantees, a top U.S. Energy Department official said on Wednesday.
The bankruptcy and ensuing criminal investigation into California-based Solyndra LLC has sparked outrage over the Obama administration's efforts to build a clean energy program with loan guarantees and subsidies.
While we are all disappointed in the outcome, securing America's leadership in this vital new industry requires that we support innovation and deployment, Jonathan Silver, who heads the energy department's loan guarantee program, told a hearing in the House of Representatives.
I can't imagine a scenario in which we would willingly as a country walk away from what would be undoubtedly one of the largest if not the largest industries in the world over the next several decades, he told a hearing called to probe the Solyndra loan.
Republicans said the collapse calls into question the competency of the loan program and the ability of the department to effectively distribute another $10 billion in loan guarantees to green technology companies before a Sept. 30 deadline.
Was Solyndra just one bad bet by an administration rushing to claim credit for the loan guarantee or is it the tip of the iceberg? asked Fred Upton, the chairman of the House Energy and Commerce Committee.
If the administration was so wrong about Solyndra after nine months of due diligence how can it possibly exercise the proper controls when doling out another $10 billion in the next couple of weeks? he asked.
President Barack Obama praised the company for its technology during a visit to its manufacturing facility last year, making the company a centerpiece of the administration's efforts to stimulate the economy and create green jobs.
The California solar-panel maker, citing international competitions, filed for Chapter 11 bankruptcy protection last week. FBI agents searched the company's offices two days later, in a possible investigation over the rewarding of the federal loan guarantees.
The U.S. Department of Energy's loan program for green energy projects was created under the Bush Administration in 2005, but the first loan guarantee wasn't extended until four years later when the loan office received funding under the federal economic stimulus.
The solar-power panel maker received a $535 million federal loan guarantee in 2009, the first awarded under the program to support innovative green technologies.
Solyndra's top executives were invited to testify before the subcommittee on Wednesday, but delayed their appearance until next week.
Solyndra is the third U.S. solar firm to declare bankruptcy in recent weeks. Tumbling prices on solar panels worldwide have hit profits at industry heavyweights such as China's Suntech Power Holdings Co Ltd (STP.N) and U.S.-based First Solar Inc (FSLR.O) this year. Small, up-and-coming solar companies have found it increasingly difficult to stay afloat. [nN1E77O11T]