The F.B.I. on Thursday raided the office of a California solar company that borrowed $528 million from the federal government before filing for bankruptcy, as House Republicans announced that they would call two top Obama administration officials to testify about the case next week.
The federal agents, acting in a joint investigation with the inspector general of the Department of Energy, served search warrants on Solyndra, which announced last week that it was filing for bankruptcy protection. The search was part of an investigation into the loans Solyndra received from the Treasury Department that were guaranteed by the Department of Energy under a highly promoted federal stimulus program.
“The F.B.I. is here,” said David Miller, a Solyndra spokesman. “We don’t know the specifics. It is in connection with the loan guarantee, but other than that we don’t know.”
The administration’s handling of the loan guarantee program, which has already secured $18 billion in loans for energy projects, has come under increasing criticism from Congress.
Republican leaders of the House Energy and Commerce Committee said Thursday that they would call Jeffrey Zients, the deputy director of the Office of Management and Budget, and Jonathan Silver, the director of the Energy Department’s loan office, to testify about the program next Wednesday. The panel also plans to ask two top executives of Solyndra to testify at the hearing.
Representative Cliff Stearns, a Florida Republican who is chairman of the subcommittee on oversight and investigations, said that about $10 billion in additional loan guarantees could still be awarded before the program expired on Sept. 30. “The last thing we can afford from the Obama administration are more of the same sloppy, poor investments in the final rush to get the cash out the door,” he said in a statement.
Solyndra’s approach has been controversial in the solar industry. Rather than conventional, flat solar panels, the company made tube-shaped modules that could harvest early morning light and evening sunsets for electricity. Its arrays were lighter and easier to install.
Critics have noted that Solyndra’s modules cost far more than conventional panels. The modules cost $2 a watt to produce, according to Shyam Mehta of GTM Research. Chinese crystalline solar module makers can produce modules for $1.10 a watt, and the price continues to fall.
Some industry specialists say that the decision to offer Solyndra the loan guarantees may have looked better two years ago, when prices for cells were higher and the price of silicon, which is used in most cells but not in Solyndra’s, was very high.
A likely area of inquiry by investigators, though, is a decision early this year by the Energy Department to allow Solyndra, which was in a cash-flow crisis, to borrow an additional $69 million from private investors that would be repaid before the government’s loans if the company went bankrupt. Solyndra then drew down about $67 million more in government loans.
“This restructuring gave Solyndra and its workers the best possible chance to succeed in a very competitive marketplace and put the company in a better position to repay the loan,” the department said in a statement on Thursday.
Venture capitalists and others had invested more than $1 billion in Solyndra. Last year President Obama toured Solyndra’s factory in Fremont, Calif., and the company became a symbol of his push to promote “green” jobs.
Solyndra said it had sold more than $250 million worth of modules, but it has had product delays and management changes.
Last week, Solyndra shut its doors and laid off all of its 1,100 employees, a prelude to this week’s formal bankruptcy filing.
Solyndra was a leading beneficiary of the Energy Department’s programs to promote alternative energy, which were expanded as part of the 2009 economic stimulus legislation.
George Kaiser, an Oklahoma billionaire, is one of the largest investors in Solyndra through Argonaut Ventures and a family foundation, and he was also a donor to Mr. Obama’s 2008 campaign. The company had begun preparing its federal loan application well before the election.
A buyer could emerge for all or part of the company.
Article source: http://feeds.nytimes.com/click.phdo?i=71fe264247dbdc566e42e39bc8ac8c8d
Speak Your Mind
You must be logged in to post a comment.