By
updated 9/28/2011 3:25:42 PM ET 2011-09-28T19:25:42

The Energy Department on Wednesday approved two loan guarantees worth more than $1 billion for solar energy projects in Nevada and Arizona, two days before the expiration date of a program that has become a rallying cry for Republican critics of the Obama administration's green energy program.

Energy Secretary Steven Chu said the department has completed a $737 million loan guarantee to Tonopah Solar Energy for a 110 megawatt solar tower on federal land near Tonopah, Nev., and a $337 million guarantee for Mesquite Solar 1 to develop a 150 megawatt solar plant near Phoenix.

The loans were approved under the same program that paid for a $528 million loan to Solyndra Inc., a California solar panel maker that went bankrupt after receiving the money and laid off 1,100 workers. Solyndra is under investigation by the FBI and is the focal point of House hearings on the program.

SolarReserve LLC, of Santa Monica, Calif., the parent company for Tonopah, is privately held. The Energy Department said its rules prevented it from discussing the company's financial information. Sempra Energy of San Diego, which owns Mesquite, is publicly held.

Spokesman Damien LaVera said the two projects had extensive reviews that included scrutiny of the parent companies' finances.

Chu said the Nevada project would produce enough electricity to power more than 43,000 homes, while the Arizona project would power nearly 31,000 homes. The two projects will create about 900 construction jobs and at least 52 permanent jobs, Chu said.

"If we want to be a player in the global clean energy race, we must continue to invest in innovative technologies that enable commercial-scale deployment of clean, renewable power like solar," Chu said in a statement.

Senate Majority Leader Harry Reid, D-Nev., is a strong supporter of the Nevada project, which he says will help his state's economy recover.

The loan approvals came just two days before a renewable energy loan program approved under the 2009 economic stimulus law is set to expire. At least seven projects worth more than $5 billion are pending.

Rep. Cliff Stearns, R-Fla., chairman of a House energy subcommittee that is investigating Solyndra, said the impending deadline was no reason to complete loans before they are ready.

"Solyndra was the product of a bad bet rushed out the door, and taxpayers are now on the hook," he said. "We cannot afford DOE rushing out more Solyndras in these final hours."

A government watchdog group said the Solyndra bankruptcy shows the need for greater oversight of all the department's loan guarantee programs.

"It is time for a full audit of their activities, their management, and their results," said Tom Schatz, president of Citizens Against Government Waste, Washington-based advocacy group.

"Candidly, it might be time for the federal government to rethink the whole idea of loan programs," Schatz added, calling the government's track record on loan guarantees "lousy."

Too often, the government either backs risky or failing ventures, resulting in a loss of taxpayer money, or subsidizes companies and industries that are mature and profitable and don't need the money, such as the oil and gas industry, Schatz said.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Video: Solyndra execs invoke 5th amendment

  1. Closed captioning of: Solyndra execs invoke 5th amendment

    >> critical spotlight shining on top executives from the failed solar energy company that got hundreds of millions of dollars of taxpayer funded loans. just moments ago, sow lin dhra solyndra ceo, sworn in.

    >> the important oversight role that it plays. as much as i wish to be able to answer the members' questions, i have been advised by my counsel it is the better course for me to assert my constitutional right to decline to answer questions under the fifth amendment.

    >> now we have our own modern day great train robbery. but it appears we have a great heist of over half a billion dollars and possibly even willing collaborators maybe even co-conspirators of the u.s. government who rushed out a $535 million loan to solyndra.

    >> kelly o'donnell is watching the hearing. kelly, listening to are the start of it, that's a sample. pretty fiery.

    >> reporter: one of those times when members ever congress are pointing fingers, raising this voices targeting those two executives. in part, with just a week of going bankrupt those two gentlemen, harrison and stover came to members of congress and talked about the health of their company. there are members who feel they were lied toance and there's a bigger issue about the fate of solar energy and the programs associated with them, and that's where it falls on political lines. fregs, you' for example one of the more senior members, democrat markey, an expert on this. they were making an example of this one's company to hurt a broader industry.

    >> the republican majority is recklessly exploiting this one case to advance a political agenda that is very clearly aimed at killing the solar wind and renewable industries.

    >> reporter: one of the things we'll see is a lot of discussion about the 1,000 employees who lost their job, the loan, half billion dollars not repaid. so when the witnesses decide not to answer questions by taking their fifth amendment rights, and there were some members of the committee who said they respect that, but were angry they couldn't get their questions answered. then it becomes the sort of political theater of asking those questions anyway, and subjecting those two officials to kind of the withering experience at being before congress. there's an ongoing investigation. much more of this. this was certainly one of the timing you could see congress venting anger feeling duped by this company and the taxpayers as well. richard?

Interactive: Solar power

Discuss:

Discussion comments

,

Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments