Solar Industry Pleads Obama to Help Restore Loan Guarantees

Solar industry officials are pleading with President Obama to restore billions of dollars in renewable energy loan guarantees that Congress is at least temporarily cutting to pay for emergency education and Medicaid help to states and other policy priorities.

The loss of these loan guarantee funds could help “send solar development into a tailspin that will be difficult to reverse,” according to a letter to Obama sent Monday from Rhone Resch, president and CEO of the Solar Energy Industries Association (SEIA).

House lawmakers Tuesday are slated to approve a $26.1 billion state education and Medicaid funding package the Senate passed last week that would be partially paid for by slashing $1.5 billion in renewable energy-loan guarantees approved in last year’s economic stimulus bill.

Renewable-energy groups sent House Speaker Nancy Pelosi (D-Calif.) a letter Friday urging the House to drop that cut. But that isn’t expected to happen, and Obama is expected to sign the bill as is.

“From everything we’ve heard at this point is that it’s a done deal,” said SEIA spokeswoman Monique Hanis on Monday. “So we have to get it fixed when they come back in September.”

The letter to Obama from the solar industry comes amid increasing — and increasingly public — frustration from renewable energy groups.

When Congress last August took out $2 billion in Energy Department (DOE) renewable-loan guarantees to help pay for the “Cash for Clunkers” program, “we had continued in a polite way behind the scenes” to get it replenished, Hanis said.

But while the House has agreed to replenish those funds, the Senate has not. “We’re extremely concerned and in fact perplexed because it was one of the administration’s goals,” Hanis said.

Obama last week announced loan guarantees for two solar companies — a 280-megawatt power plant in Arizona and manufacturing facilities in Colorado and Indiana. “There are dozens of job-creating renewable energy projects like these awaiting loan guarantees from DOE, which are now placed at serious risk by the Senate’s action,” Resch wrote Obama.

The $3.5 billion amounts to more than half of the $6 billion set aside for renewable energy loan guarantees in last year’s economic stimulus bill, and its removal “will significantly undermine” DOE’s loan guarantee program, according to the letter sent to Pelosi Friday from trade associations representing the solar, wind, geothermal, biomass and hydropower industries. The loan guarantees would go towards the financing of $60 billion worth of renewable energy projects, they say.

SEIA's Resch is asking Obama to “swiftly restore” the $3.5 billion in loan guarantees and direct DOE and the White House Office of Management and Budget “to take every step necessary to expedite the closing of loan guarantees.” They also want a two-year extension of a Treasury grant program set to expire this year “due to the continued lack of tax-equity to finance renewable projects and the slow processing of loan guarantees,” Resch wrote.

Congressional Democratic leaders are promising that the funds will be restored. Pelosi “will continue to seek assurances for the restoration of these funds,” a Pelosi aide said Monday.

Senate Majority Leader Harry Reid (D-Nev.) last week also vowed that Congress will restore the funds eventually. An aide to Sen. Patty Murray (D-Wash.), a member of Senate Democratic leadership who successfully offered an amendment scaling back the funding to help pay for the education and Medicaid help, said she “worked closely with the administration to ensure that Recovery Act funding used to offset this bill would not be spent this year.”

Reid said the funding is merely a small piece of $20 billion in DOE stimulus funds the department has been slow to dole out. That includes $13 billion for state energy programs, among others, as well as the $6 billion for the renewable energy loan guarantee program.

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