DOE PLANS TO SPEND NEARLY $9 BILLION IN ADDITIONAL LOAN GUARANTEES BY SEPTEMBER 30, 2011

WASHINGTON, SEPT. 20, 2011 – An investigation into the U.S. Department of Energy’s (DOE’s) loan guarantee program discovered that a rush to close the loan to Solyndra prevented due diligence in protecting taxpayers from an overly risky venture.  Rep. Cliff Stearns (R-FL), Chairman of the House Energy and Commerce Committee’s Subcommittee on Oversight and Investigations, today expressed his concern that DOE may not be able to provide due diligence in reviewing additional guaranteed loan commitments that must be closed by the end of this month.

Stearns, joined by Chairman Fred Upton (R-MI) of the Energy and Commerce Committee and Rep. Ed Whitfield (R-KY), Chairman of the Committee’s Energy and Power Subcommittee, wrote to Chu, “Now that Solyndra has declared bankruptcy, we cannot help but wonder whether additional time to review this guarantee might have prevented the taxpayers from being on the hook for the $535 million loaned to the company.” 

Stearns noted that as of today DOE has 14 conditional commitments totaling $8.89 billion outstanding, with 10 of those awarded in June, or later, of this year totaling $8.029 billion. Said Stearns, “DOE must approve nearly $9 billion in conditional loan guarantees -- about half the cost of the entire program -- and the administration plans to get it all out the door in 10 days.  If the administration was so wrong about Solyndra after what DOE and OMB officials claim were at least nine months of due diligence, how can these agencies possibly exercise the proper controls when trying to rush out nearly $9 billion before the September 30th deadline.”

In the letter, they ask Chu if DOE intends to close these 10 conditional commitments before the September 30^th deadline, if DOE has the authority to seek more time to conduct due diligence on them, and what would result if DOE does not finalize each of the 10 conditional commitments.  A response was requested by September 23, 2011.

A copy of the letter is attached