CLAIM: The Department of Energy’s Loan Guarantee Program is wasting taxpayer money. Abound Solar’s bankruptcy is proof of that.
- The Loan Guarantee Program was created in 2005 with bipartisan support under the George W. Bush administration and designed to provide government support for “innovative technologies.” (Source: CNNMoney, http://cnnmon.ie/LBryTy)
- Congress appropriated a pool of funds to cover any losses from the program. 95% of that money is still available to cover any potential future losses. (Source: CNN Money, http://cnnmon.ie/LBryTy)
- 87 % of the $16.1 billion in DOE loan guarantees is backing 18 power generation projects, which have a low risk of default because they were required to have buyers for their power output. (Source: Bloomberg Government, http://bit.ly/rCXgZP)
- The Loan Guarantee Program has been credited with making solar “bankable” for major investors – shifting it from a risky investment requiring a costly premium to “part of a much broader capital market.” (Source: Bloomberg BusinessWeek, http://buswk.co/N9AdLu)
- Partly as a result, the solar market in the United States continues to grow. In 2011, U.S. solar photovoltaic installations grew by over 100%; the value of the systems installed in 2011 alone was more than $8.5 billion. (Source: Solar Energy Industries Association, http://slidesha.re/AuCU8p)
- Like many companies across the global solar industry, Abound Solar faced intense pressure from the rapidly declining cost of photovoltaic panels and Chinese companies’ cost and financing advantages. (Source: Credit Suisse, http://bit.ly/LaOjNf)
- Abound Solar had received bipartisan support, including a range of tax credits and grants (Source: Indiana Economic Development Corporation, http://1.usa.gov/MEsKpo)