Another hot topic at President Obama’s news conference this week, despite his best efforts to focus on the jobs bill, was solar panel manufacturer Solyndra. Last month the company, which in 2009 received a $535 million federal loan, declared bankruptcy. Yet the president had emphatically lauded Solyndra as a model for government investment in clean energy, visiting its California headquarters as part of his 2010 “Main Street Tour.”
Behind the scenes, administration officials were warned about the shaky standing of Solyndra, which made solar panels without silicon. The business floundered when silicon prices dropped sharply. Democratic members of the House energy subcommittee, which is now investigating the company’s bankruptcy (along with another investigation by the Treasury Department inspector general into the Solyndra loan, and a fraud investigation into Solyndra by the FBI), released emails that showed the concern.
In a 2010 email to White House senior adviser Valerie Jarrett, Steve Westly, a former California state controller and green venture capitalist, wrote, “Many of us believe the company’s cost structure will make it difficult for them to survive long term.” A staffer from the Office of Management and Budget wrote that “bad days are coming.”
A report by the Energy Department’s inspector general cautioned that the agency hadn’t fully developed regulations needed to manage the loan program — created in 2005 under President George W. Bush — that provided funds for Solyndra. The Obama administration, however, repeatedly downplayed the concerns.
At a White House press conference on Thursday, the president gave his explanation for supporting the company despite the alarms over its vetting and viability:
We knew from the start that the loan guarantee program was going to entail some risk, by definition … The overall portfolio has been successful. It has allowed us to help companies, for example, start advanced battery manufacturing here in the United States. It’s helped create jobs. There were going to be some companies that did not work out; Solyndra was one of them … And of course there were going to be debates internally when you’re dealing with something as complicated as this.
Asked whether his administration also ignored the warnings out of eagerness for his clean-energy “Win the Future” agenda to succeed, Obama insisted that was not a factor:
Even for those projects under this loan guarantee program that have ended up being successful, there are those in the marketplace who have been doubtful. So, I mean, there’s always going to be a debate about whether this particular approach to this particular technology is going to be successful or not.