Complaint letters from contributors about the funding:
PUBLIC CITIZEN FILING AGAINST DOE:
December 12, 2008
Mr. Lachlan Seward, Director, Advanced Technology
Vehicles Manufacturing Incentive Program
U.S. Department of Energy
1000 Independence Ave., S.W.
Department of Transportation, West Building
Washington, DC 20585
Comments on Advanced Technology Vehicles Manufacturing Incentive Program, Interim
Final Rule, 73 FR 66721, November 12, 2008, Docket No. DOE-HQ-2008-0020
Dear Mr. Seward:
Public Citizen respectfully submits the following comments regarding the interim final
rule (IFR) promulgated for the advanced technology vehicles manufacturing incentive program
authorized in Section 136 of the Energy Independence and Security Act (EISA).
concerns regarding this program are the choice of a static definition for the base year, and the
establishment of “performance” categories for comparing vehicles with “substantially similar”
Public Citizen is a national non-profit public interest organization with over 80,000
members nationwide, representing consumer interests through regulatory oversight, research,
public education, lobbying and litigation. The President of Public Citizen, Joan Claybrook, was
Administrator of NHTSA from 1977 to 1981 and has been advocating for improvements in
highway and auto safety for over forty years.
Comment on this IFR comes in the midst of a complicated and rapidly-changing context
regarding the state of the domestic auto industry. This context warrants some brief discussion.
Specifically, due to rapidly deteriorating conditions in the domestic auto industry, the
promulgation of these regulations was substantially expedited as a result of pressure from the
domestic auto industry and others to quickly issue regulations to disperse funds from this
program. As a result, DOE made the IFR public three weeks in advance of the deadline set by
Congress in the continuing resolution, on November 5, instead of November 29, 2008.
However, before the IFR was published, the automakers had begun discussing the
possibility of seeking a bailout, separate from the loan guarantees that would be provided
through the advanced technology vehicles manufacturing incentive program.
Representatives from General Motors, Ford and Chrysler approached the Congress on November 18, 2008
seeking emergency financial support. Without such support, General Motors and Chrysler
indicate they are at risk of bankruptcy by the end of December 2008.
As the form of the bailout was negotiated, one major issue was the source of funding, in
particular, the Bush administration and Republican members of Congress supported using the
money appropriated by Congress to fund the advanced technology vehicles manufacturing
incentive program. The Democratic leadership supported using money from the Troubled Assets
Relief Program (TARP) fund.
There was disagreement about whether the TARP fund was
intended to provide this kind of support, and the U.S. Department of Treasury and the Federal
Reserve expressed the position that this money was not available to the auto industry to be used
for this purpose.
The House version of the bill, which was passed on December 10, 2008, would
borrow money from the advanced technology vehicle manufacturing incentive program.
While the auto bailout was ultimately tabled in the Senate, the fate of federal assistance to
the auto industry remains unclear. Whether Congress will revisit this issue when it reconvenes in
January is unclear. What is important to clarify is that the funds appropriated for the Section 136
program should go to fund retooling projects that will result in advanced technology vehicles.
Requirements of Section 136
Section 136 outlines some specific requirements for eligibility for loans. In particular,
the section defines advanced technology vehicles:
(1) ADVANCED TECHNOLOGY VEHICLE.—The term ‘‘advanced technology
vehicle’’ means a light duty vehicle that meets—
(A) the Bin 5 Tier II emission standard established in regulations issued by the
Administrator of the Environmental Protection Agency under section 202(i) of the
Clean Air Act (42 U.S.C. 7521(i)), or a lower-numbered Bin emission standard;
(B) any new emission standard in effect for fine particulate matter prescribed by the
Administrator under that Act (42 U.S.C. 7401 et seq.); and
(C) at least 125 percent of the average base year combined fuel economy for vehicles
with substantially similar attributes.
However, it is the responsibility of DOE to define “base year” and “substantially similar
(3) SELECTION OF ELIGIBLE PROJECTS.—The Secretary shall select eligible
projects to receive loans under this subsection in cases in which, as determined by the
Secretary, the award recipient—
(A) is financially viable without the receipt of additional Federal funding associated
with the proposed project;
(B) will provide sufficient information to the Secretary for the Secretary to ensure
that the qualified investment is expended efficiently and effectively; and
(C) has met such other criteria as may be established and published by the Secretary.
We note that one of the statutory requirements for eligibility is that the recipient “is financially
viable without the receipt of additional Federal funding associated with the proposed project.”
On December 4, 2008, DOE announced that it was reviewing the first applications for retooling
loans under the program, citing that the agency needed more information.
DOE must select a moving target base year
Congress left the authority to DOE to determine how to define the base year from which
fuel economy improvements are determined for establishing eligibility of certain projects for
financing under Section 136. DOE has selected the “base year” to be model year 2005.
acknowledge the agency’s observation that the average fuel economy was greater in model year
2005 than subsequent years; however, since we do not know the timeline by which DOE will
award loan guarantees under this program, it is important that the base year be adjusted. We
recommend that the base year reflect the most recent model year with the highest fuel economy,
at the time the loan guarantee is granted by DOE. Based on this definition, we acknowledge that
model year 2005 meets this criterion; however, we ask that the regulation be amended to adjust
the baseline for the most recent data available from NHTSA.
We acknowledge that the 2007 energy law only authorized $25 billion in loan guarantees,
and that the program will continue to parcel out the money until it has been exhausted.
However, in consideration of the need for a moving base year it seems possible that the industry
will attempt to get this program extended, given the financial state of the auto industry, and the
potential for these difficulties to also affect the supplier companies. The program was initially
created to encourage manufacturers to build advanced vehicles, and alleviate the pressure of
moving forward with the capital-intensive process of retooling to build these vehicles, while still
being able to meet their fuel economy obligations under the new standards set in EISA. The
circumstances and financial health of the industry have deteriorated significantly since EISA was
passed in December 2007.
The definition of “performance” vehicles is problematic
In defining “substantially similar attributes,” DOE started with the classifications of
vehicles used by the Environmental Protection Agency (EPA), but added classifications for
“performance” vehicles, which have a horsepower to weight ratio substantially greater than other
vehicles that are otherwise similar. We acknowledge that defining and separating “performance”
vehicles, whose fuel economy numbers are significantly lower than otherwise similar vehicles,
potentially results in fuel economy improvements for vehicles with “substantially similar
attributes” that are greater than the values that would result from averaging in the fuel economy
of these vehicles. However, DOE does not make any attempt to exclude these vehicles from
eligibility from the program, which potentially permits automakers to use these loan guarantees
to retool facilities to build vehicles that would only meet the fuel economy standards set for the
1985 model year.
A better approach to addressing the “performance” vehicle classification would be to
require that vehicles with this classification make a 125 percent improvement over the fuel
economy standard for the applicable model year. Until the 2011 model year, this would be a 125
percent improvement over the 27.5 mpg standard that has been in effect since 1985, or 34.7 mpg.
Giving performance vehicles special treatment in a program meant to encourage the manufacture
of advanced technology vehicles undermines the goals of the program, which are to encourage
retooling facilities to build vehicles that will substantially improve fuel economy, and reduce oil
consumption and greenhouse gas emissions.
Priority should be given to projects that will increase fleetwide fuel economy
DOE, in reviewing applications, should give priority to projects that have the potential to
substantially affect a manufacturers’ overall fleet fuel economy. Significantly improving the fuel
economy of a single vehicle model is important. However, if the manufacturer still relies heavily
on vehicles that are not fuel efficient, then the benefit of a single fuel-efficient vehicle can be
eroded or overwhelmed. This kind of priority treatment would encourage broad application of
fuel efficient components, which would do more to reduce oil consumption and improve overall
fuel economy than applying technology to one vehicle in a manufacturer’s fleet.
We support exclusion of dual fuel credit in determining improvement in fuel economy
The dual fuel credit that was established in 1988 as part of the Alternative Motor Fuels
Act provides manufacturers of vehicles capable of running both on two or more fuels. This
overwhelmingly refers to vehicles that run on gasoline or a mix of gasoline and ethanol
(commonly E85, a blend of 15 percent gasoline and 85 percent ethanol). The program has failed
to achieve its apparent goal of promoting expanded alternative fuels consumption, and has been a
loophole for automakers to comply with their fuel economy burden.
For the purposes of financing projects under Section 136, DOE has expressed that the
improvement in fuel economy will not be calculated including the dual fuel credit.
This is appropriate since the credit does not reflect a gain in fuel economy, but rather is awarded as an
incentive for the manufacture of these vehicles. This stipulation must be retained.
Consumer and environmentalists not involved in developing this program
Public Citizen acknowledges that there was significant pressure to issue the IFR quickly,
both from the statutory requirement that an IFR be issued 60 days after the funds were
appropriated, and from the ailing auto industry. However, DOE found time to meet with the auto
industry and supplier companies. We are troubled that no meetings were held with any
consumer or environmental interest groups. It is important that the agency meet with a broad
range of stakeholders to get a complete picture of the issues and concerns regarding the
development of such a program.
The DOE must structure this program to maximize its potential to encourage fuel
economy gains that will result in reduced oil consumption and foreign oil imports, and reduce
greenhouse gas emissions. This program was meant as a supplement to the improvements to be
made by the mandated increases in fuel economy in EISA, and should be carried out with that in
mind. The final regulation should be amended to require that the base year changes to reflect the
greatest level of fuel economy gains possible, and the agency should reconsider the definition of
“performance” cars, to encourage that gains made in these vehicles are at least 125 percent of the
applicable fuel economy standard for the model year that the vehicle is to be built..
Section 136, Energy Independence and Security Act, P.L. 110-140. (December 19, 2007).
See David Herzenhorne and Carl Hulse. “Democrats Seek Help for Carmakers.” The New York Times. (December
See Justin Hyde and Todd Spangler. “Deal reached for auto loans; GOP senators pledge to oppose plan.” Detroit
Free Press. (December 9, 2008).
Established as part of the Emergency Economic Stabilization Act. P.L. 110-343. (October 3, 2008).
See Margaret Carlson. “Bankers Smoke Auto CEOs in Bailout Grand Prix.” Bloomberg.com (December 4, 2008).
See Harry Stoffer. “Congress nears accord on Detroit 3 bailout.” Automotive News. (December 5, 2008).
David Shephardson. “Energy Department seeks more info on $16 billion in auto retooling requests,” The Detroit
News. (December 4, 2008).
73 Fed. Reg. 66723.
See 73 Fed. Reg. 66727. Fuel economy values for performance categories are 27.8 mpg, 28.0 mpg, 28.5 mpg and
29.5 mpg. The model year 1985 fuel economy standard is 27.5 mpg, and still stands today. A 125 percent
improvement over 27.5 mpg is 34.4 mpg.
73 Fed. Reg. 66725.
Abound Solar Facing Criminal Investigation, Fraud Accusations
|in News Departments > New & Noteworthy|
|by Jessica Lillian on Tuesday 30 October 2012|
|Loveland, Colo.-based thin-film solar manufacturer Abound Solar, which ceased operations earlier this year, is now the subject of a three-part criminal investigation.The probe centers on the company’s alleged concealment of in-the-field performance problems with its cadmium telluride (CdTe) modules. Specifically, Abound has been accused of the following crimes:- Committing securities fraud by seeking investment in the company without informing potential investors of product defects;- Committing consumer fraud by knowingly selling defective PV modules to customers; and- Misleading financial institutions when applying for bridge funding that was designed to help the company stay in business before it received its $400 million loan guarantee from the U.S. Department of Energy (DOE).Weld County, Colo., District Attorney (DA) Ken Buck and the DA’s investigations unit will head the investigation. “No one has been charged with a crime at this early point in the investigation,” the DA’s office notes in a statement.Citing in its statement a need to “protect the integrity of this active and ongoing investigation,” the DA declined to release information on the expected duration of the investigation or details on what penalties Abound might face if it is found guilty.
The criminal investigation represents the latest post-bankruptcy controversy for Abound, which once boasted that it would own “the largest solar manufacturing facility in the United States” once its second factory was completed.
However, before Abound could realize its 840 MW plans, financial woes sank its operations. Abound ceased production of its first-generation module in February before shutting down and filing for bankruptcy protection in June.
With controversy surrounding the company’s DOE loan guarantee, a politically chargedcongressional hearing followed in July. In his testimony, then-CEO Craig Witsoe insisted that it was the dramatic drop in the price of a competing technology – crystalline PV – that had forced the company out of the market.
Lawmakers at the July hearing, which was conducted by the House Committee on Oversight and Government Reform, accused DOE officials of ignoring signals that Abound was not a financially sound investment, but they made no fraud allegations similar to those described in the DA probe.
In the letter, committee leaders Fred Upton, R-Mich., and Cliff Stearns, R-Fla., raised questions about the functionality of Abound’s modules. The lawmakers cited independent tests revealing that the panels suffered from a significant performance reduction when exposed to high levels of heat.
Excessive copper diffusion may have been the root cause of the issue. Module malfunctions led to several customers’ requests for repairs or replacements, according to the committee.
“We have questions about what role these technological problems played in DOE’s decision to suspend Abound’s loan guarantee disbursements in September 2011, and when DOE first became aware of these problems,” the committee leaders wrote in their letter to Chu.
Although Abound’s loan guarantee originally totaled $400 million, the company wound up receiving only $70 million before disbursements were suspended. David Franz, acting executive director of the DOE’s loan program office, explained during the July hearing that the loan guarantee terms required Abound to meet certain milestones in order to keep receiving its payments.
For its investigation, the Energy and Commerce Committee has asked Chu to provide an array of documents, including Abound’s technical reports and product test results, the DOE’s loan guarantee monitoring reports, financial analyses and communications between the department and Abound.
Chu was given a deadline of Oct. 24 to supply the requested materials; the committee has not released information on whether that deadline was met.
As the investigations move forward, Energy and Commerce committee leaders continue to draw parallels between Abound and Solyndra. The latter company has become a well-known symbol of what critics of the Obama administration believe are wasteful investments in solar energy technology.
“While these investigations are still under way, one thing remains clear – the Obama administration has failed at its game of picking winners and losers,” the committee said in a statement. “Like Solyndra, Abound is a product of the Department of Energy’s mismanaged loan guarantee program, which has resulted in the loss of hundreds of millions of taxpayer dollars and thousands of jobs.”
Why Did Leroy Miller of The American University file a FOIA case against DOE?
SENATE INVESTIGATION CHARGES:
Bridging the gap between academic ideas and real-world problems
ASSESSING THE DEPARTMENT OF ENERGY
LOAN GUARANTEE PROGRAM
VERONIQUE DE RUGY
Senior Research Fellow
In his famous book Economics in One Lesson, economist Henry Hazlitt wrote, “Government encouragement to
business is sometimes as much to be feared as government hostility.”
In 2009, renewable energy company Solyndra received $535 million through the federally backed 1705 loan guarantee
For obvious reasons, more than any other recent events, the waste of taxpayers’ money due to Solyndra’s failure
has attracted much attention. However, the problems with loan guarantees are much more fundamental than the
cost of one or more failed projects. In fact, the economic literature shows that (1) every loan guarantee program
transfers the risk from lenders to taxpayers, (2) is likely to inhibit innovation, and (3) increases the overall cost
of borrowing. At a minimum, such guarantees distort crucial market signals that determine where capital should
be invested, causing unmerited lower interest rates and a reduction of capital in the market for more worthy
projects. At their worst, they introduce political incentives into business decisions, creating the conditions for
businesses to seek financial rewards by pleasing political interests rather than customers. This is called cronyism,
and it entails real economic costs.
Yet, these loan programs remain popular with Congress and the executive. That’s because in general most of the
financial cost of these guaranteed loans will not surface for many years. That means that Congress can approve
billions of dollars to benefit special interests, with little or no immediate impact to federal appropriations in the
short term, because they are almost entirely off-budget.
HOW DO THESE LOAN GUARANTEES WORK?
The DOE Loan Programs Office (LPO) administers three separate loan programs: (1) Section 1703 loan guarantees,
(2) Section 1705 loan guarantees, and (3) Advanced Technology Vehicle Manufacturing (ATVM) loans. Here are
descriptions of the three loan programs, as explained by DOE:
1. Henry Hazlitt, Economics in One Lesson, in Chapter VI Credit Diverts Production, Laissez-Faire Books, Benicia, CA, 1946, p. 27.
2. Matt Mitchell, The Pathology of Privileges (working paper, Mercatus Center at George Mason University, July 2012).
3. United States Department of Energy, accessed June 13, https://lpo.energy.gov/.
For more information or to meet with the scholars, contact
Robin Bowen, (703) 993-8582, firstname.lastname@example.org
Mercatus Center, 3301 Fairfax Drive, 4
Floor, Arlington, VA 22201
The ideas presented in this document do not represent official positions of the Mercatus Center or George Mason University.
• Section 1703 of Title XVII of the Energy Policy Act of 2005 authorizes the U.S. Department
of Energy to support innovative clean energy technologies that are typically unable to obtain
conventional private financing due to high technology risks.
• Advanced Technology Vehicles Manufacturing (ATVM) loans support the development of
advanced technology vehicles (ATV) and associated components in the United States. They also meet
higher efficiency standards.
• The Section 1705 Loan Program authorizes loan guarantees for U.S.-based projects that commenced
construction no later than September 30, 2011 and involve certain renewable energy systems, electric
power transmission systems, and leading edge biofuels.
According to LPO’s website, DOE’s loan guarantee authority originated from Title XVII of the Energy Policy Act
of 2005 (P.L. 109–58).
Under Section 1703, the federal government can guarantee 80 percent of a project’s total
cost. The American Recovery and Reinvestment Act of 2009 (P.L. 111–5) amended the Energy Policy Act of 2005
by adding Section 1705.
Section 1705 was created as a temporary program, and 1705 loan guarantee authority
ended on September 30, 2011.
The dollar volume of loans that can be guaranteed under DOE’s authority is predetermined by congressional
appropriations that oversee the program. A simple way to explain how these loans work is the following: If a recipient
As with other loan programs, to prevent taxpayers’ exposure, the federal government has established a credit
subsidy fee. In this case, the cost of the fee is determined by DOE, with guidance from OMB. The lenders usually
charge the up-front guarantee fee to the borrower after the lender has paid the fee to DOE and has made the first
disbursement of the loan.
This is not the case for 1705 loans, however. Under the stimulus bill, DOE received appropriated funds to pay
for credit subsidy costs associated with Section 1705 loan guarantees, which, after rescissions and transfers, was
$2.435 billion. As the Congressional Research Service rightly puts it, “Section 1705 loan guarantees were very
attractive as they provided an opportunity to obtain low-cost capital with the required credit subsidy costs paid
for by appropriated government funds.”
DOE does not provide loans directly. Instead, borrowers have to apply to qualified finance organizations. These
lenders are expected to perform a complete analysis of the application. Then DOE reviews the lender’s credit
analysis rather than conducting a second analysis. DOE still makes the final credit and eligibility decision.
DO LOAN GUARANTEES DO WHAT THEY CLAIM TO DO?
Leaving aside the question of whether the government should encourage the production of certain goods or services,
4. Section 1703 of the Energy Policy Act of 2005 (P.L. 109-58).
5. Section 1705 of the Energy Policy Act of 2005 (P.L. 109-58). Section 1705 was created by amending the EnergyPolicy Act of 2005 through the
American Recovery and Reinvestment Act of 2009 (P.L. 111-5)
6. However, the Office of Management and Budget has calculated that only 55 percent of loan can be recouped from the sale of assets.
7. Phillip Brown, “Solar Projects: DOE Section 1705 Loan Guarantees,” (Congressional Research Service, October 25, 2011), accessed June 13,
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 2
not have gotten capital on their own). Absent such a private-sector deficiency, the DOE’s activities would simply
be a wasteful at best, politically motivated at worst subsidy to this sector of the economy.
Yet, many argue that some public policy objectives require the sacrifice of marketplace efficiency. It is an accepted
feature of modern American government that some public interests or social policy gains outweigh economic
losses. In the case of green energy, the government’s lending programs could fulfill specific public policy objectives
In describing its role in the economy, the DOE proclaims that its loans help save the planet
by helping to secure
funding for the earlier-stage technologies or the later commercialization stage—known as the manufacturing
“Valley of Death.”
It also claims that the loan recipients will generate economic growth and “green” jobs that
otherwise would not appear. DOE can thus be judged on its ability to meet these public policy goals—namely, to
fill the supply-and-demand gap in the clean energy loan market, particularly for startups.
To measure the DOE results, I looked at the flow of DOE credits to evaluate who receives them and whether the
DOE is meeting its stated policy objectives of promoting new startups and encouraging the creation of green jobs.
A close examination demonstrates that neither stated DOE policies nor its actual lending patterns provide evidence
FOLLOWING THE 1705 LOAN GUARANTEE PROGRAM MONEY
Since 2009, DOE has guaranteed $34.7 billion, 46 percent of it through the 1705 loan program, 30 percent through
the 1703 program, and 14 percent through the ATVM.
Loan Guarantees by Program
The 1705 (under which Solyndra received funding) authorized loan guarantees for programs for “certain renewable
The data shows that:
Source: U.S. Department of Energy, Loan Guarantee Programs
8. Mike King and W. David Montgomery, “Let’s Reset Our Energy Policy Starting with Loan Guarantees,” in Pure Risk: Federal Clean Energy
Loan Guarantees, ed. Henry Sokolski (Nonproliferation Policy Education Center, 2012)
9. Sustainablebusiness.com, “Clean Energy: Crossing the Valley of Death,” June 2010, http://www.sustainablebusiness.com/index.cfm/go/
10. U.S. Department of Energy, Loan Programs Office: https://lpo.energy.gov/?page_id=45
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 3
• 26 projects were funded under the 1705, and guaranteed roughly $16 billion in total.
• Some 2,378 permanent jobs were claimed to be created under the program. This works out to a cost
per job of $6,731,034.
• The recipient of the most 1705 loans is NRG Energy Inc. (BrightSource).
• NRG Energy Inc. (BrightSource) received $1.6 billion (11 percent of the overall amount guaranteed
under the 1705).
• The top 10 recipients of loans under the 1705 program:
• Are all solar generation companies,
• Received 76 percent of the overall amount guaranteed,
• Received $12.2 billion in loan guarantees, and
• Included NextEra Energy Resources, LLC (Desert Sunlight), a fortune 200 company;
Abengoa Solar Inc. (Solana), a Spanish multinational company; and Prologis (Project Amp), a
global real estate investment trust. Utility firms like NRG Energy received three separate loans
in the top 10 recipient list.
• Prologis received $1.4 billion (8.75 percent of the total) to install solar panels on top of a building it owns.
• Solyndra, the now bankrupted solar company, received $535 million in loan guarantees or 3.34
percent of the total.
• Cogentrix, a wholly owned subsidiary of the Goldman Sachs Group Inc, received a $90 million
guarantee from the government.
Section 1705 Supported Projects
Source: Department of Energy, Loan Programs Office
Company recipients given in parentheses
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 4
If we organize the data by companies receiving 1705 loans, we find:
• The recipient of the most 1705 loans is NRG Energy Inc.
• NRG Energy Inc. received $3.8 billion (23.7 percent of the overall amount guaranteed under the
• Four companies received 64 percent, or $10.3 billion, of the total amount guaranteed under the 1705
program. These companies are:
• NRG Energy,
• NextEra Energy,
• Arbogea, and
First, it should be noted that very few permanent green jobs were created under the 1705 loan program (or any of
the other loan programs). The Obama administration had initially pushed these projects as job generators, claim-
ing that it could create 5 million jobs in America through investment in green technology.
Section 1705 Supported Companies
Section 1705 Supported Companies
Source: Department of Energy
Produced by Veronique de Rugy, Mercatus center
Source: Department of Energy
Produced by: Veronique de Rugy, Mercatus Center
Also, to the extent that “green jobs” were created, the $6.7 million cost per job is quite spectacular. This trend and
number probably dismisses this particular loan program as a job program.
Second, as we can see here, under the 1705 program most of the money has gone to large and established companies
rather than startups. These include established utility firms, large multinational manufacturers, and a global real
estate investment fund. In addition, the data shows that nearly 90 percent of the loans guaranteed by the federal
government since 2009 went to subsidize lower-risk power plants, which in many cases were backed by big com-
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 5
panies with vast resources. This includes loans such as the $90 million guarantee granted to Cogentrix, a subsidiary
of Goldman Sachs. Currently, Goldman Sachs ranks number 80 on the list of America’s Fortune 500 companies.
This probably means that if there were an actual gap between the supply and demand for loans for energy companies,
Third, there seems to be an even more troubling trend of “double dipping” by large companies that received loan
guarantees from the DOE program. Many of the companies that have benefitted from subsidized loans under
the 1705 guarantee program also received additional grants under the American Recovery and Reinvestment Act
(ARRA). For example, Prologis (which benefitted from $1.4 billion in subsidized loans) received a grant for $68,000
for the purpose of “rent for warehouse space” under the Recovery Act.
Green Mountain Energy, a company of NRG Energy, received two grants under the ARRA in the second quarter of
fiscal year 2011. Likewise, Reliant Energy and Reliant Energy Tax Retail LLC, two other NRG Energy companies,
reported receiving at least 37 grants under the ARRA. These grants augmented the $3.8 billion in loan guarantees
for NRG Energy distributed under the Section 1705 Loan Program.
NRG will also be eligible to receive $430 million from the Department of the Treasury.
In addition, many companies
Quoted in the New York Times recently, NRG’s chief executive, David W. Crane, explained how his company and
its partners have secured $5.2 billion in federal loan guarantees, plus hundreds of millions in other subsidies for
four large solar projects. “I have never seen anything that I have had to do in my 20 years in the power industry
that involved less risk than these projects,” he said in a recent interview. “It is just filling the desert with panels.”
Examples of companies benefitting from multiple assistance programs initiated during this period abound. For
instance, in addition to the $538 million it received under the 1705 loan program, Solyndra benefited from a $10.3
million loan guarantee that the Ex-Im Bank extended to a Belgian company (described in the Ex-Im deal data as
“Zellik Ii Bvba”) to finance a sale of Solyndra products.
Solyndra isn’t alone. First Solar’s Antelope Valley project received a $646 million 1705 loan in 2011 through its
partner Exelon, and per my calculation from the Ex-IM Bank FOIA deal data information for FY2011,
More troubling is the fact that some of the Ex-Im money went to a Canadian company named St. Clair Solar,
which is a wholly owned subsidiary of First Solar.
St. Clair Solar received a total of $192.9 million broken into
11. CNN Money, America’s Fortune 500 Companies. http://money.cnn.com/magazines/fortune/fortune500/2012/snapshots/10777.html
12. Eric Lipton and Clifford Krauss, “A Gold Rush of Subsidies in Clean Energy Search,” New York Times, November 11, 2011
13. Department of Treasury: 1603 http://www.treasury.gov/initiatives/recovery/Pages/1603.aspx
14. Eric Lipton and Clifford Krauss, “A Gold Rush of Subsidies in Clean Energy Search,” New York Times, November 11, 2011
15. Export-Import Bank of the United States, 2011 Annual Report, http://www.exim.gov/about/reports/ar/2011/index.html, p. 30.
17. Tim Carney, Firm Sells Solar Panel to Itself – Taxpayers Pay, The Washington Examiner, March 18th 2010,
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 6
two loans to buy solar panels from First Solar. In other words, the company received a loan to buy solar panels
from itself. Incidentally, First Solar also received a $16.3 million loan from the government in 2010 to expand its
factory in Ohio.
This double-dipping by energy companies isn’t new, unfortunately. While there is no doubt that the deals are
lucrative for the companies involved, taxpayers have a lot to lose. Further, double-dipping provides evidence that
businesses will be tempted to steer away from productive value creation for society and instead work on narrowly
serving political interests for financial gain.
THE CASE AGAINST CLEAN ENERGY LOAN GUARANTEES
A great deal of attention has been focused on Solyndra, a startup that received $528 million in federal loans to
develop cutting-edge solar technology before it went bankrupt, had to lay off over a thousand workers, and left
taxpayers to foot the bill. Obviously, the considerable waste of taxpayers’ money is upsetting. But it is only one
aspect of the fundamental problems caused by loan guarantee programs in general, and DOE’s clean energy loan
programs in particular.
1. Socialized Losses and Privatized Gains
Historically, loans guaranteed by the government have had a higher default rate than the loans issued by the private
This compares to 4.3 percent for credit cards and 1.5 percent for bank loans
guaranteed by the Federal Deposit Insurance Corporation.
Also, the Congressional Budget Office has calculated that the risk of default on the DOE’s nuclear loan guarantee
program, for example, is well above 50 percent.
In 2011, the CBO updated its study and replaced the embarrassing
default rate with a list of variables affecting the rate.
While it doesn’t provide a specific rate, the report asserts
that higher equity financing of these projects would reduce the risk of default. However, this is rarely the case, as
most loan guarantee programs cover 80 percent of their financing through debt rather than equity.
Moreover, according to the CBO, when the federal government extends credit, the associated risk of those obligations
Also, if the loan isn’t repaid, then the cost of the investment is to taxpayers. However, if the loan is repaid as
expected, the lender will benefit from all the interest payments it collected thanks to a fairly risk-free loan, and
the borrower will collect the fruit of its successful business venture. In other words, loan guarantee programs are
yet another way that the federal government socializes losses while privatizing benefits.
18. Tim Carney, Firm Sells Solar Panel to Itself – Taxpayers Pay, The Washington Examiner, March 18th 2010, http://campaign2012.washingtonexaminer.com/article/firm-sells-solar-panels-itself-taxpayers-pay/434251.
“Banking on the SBA” (Mercatus on Policy,
2007, Mercatus Center at George Mason University) accessed on June 13,
Clean Energy Loan
Moral Hazards,” in Pure
Clean Energy Loan
Guarantees ed. Henry
Congressional Budget Office [CBO], “The
Cost-Effectiveness of Nuclear Power
for Navy Surface Ships,” (May 12, 2011), http://www.cbo.
Russ Roberts, “Gambling with Other people’s money” Mercatus Center at George Mason University,
April 28, 2010, accessed June 13, 2012,
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 7
2. Moral Hazard
Federally backed loans create a classic moral hazard. Because the loan amount is guaranteed, banks have less
incentive to evaluate applicants thoroughly or apply proper oversight. In other words, the less skin the lender
has in the game, the less likely the lender will effectively vet the quality of the project. Also, the company that
borrows the money has less skin in the game than it would if its loan weren’t guaranteed. In addition, each time
the government bails out a firm or has to shoulder the cost of a loan guarantee that got into financial trouble, it
reinforces the signal to borrowers and bankers alike that it’s OK to take excessive risks.
In a March 2012 report, the Government Accountability Office (GAO) found that the DOE loan guarantee program
When GAO requested data from the DOE on the status of the applications, the DOE
did not have consolidated data readily available and had to assemble these data over several months from various
sources. Inadequate documentation and out-of-date review processes reduce the assurance that the DOE has
treated applicants consistently.
These findings do not prove the ability of the DOE to fully assess and mitigate project risks. Moreover, while in
the absence of government intervention the private sector builds the infrastructure to assess risk, the federal government
has neither the expertise
nor the incentive
to build such a safety net. This increases
The moral hazard of loan guarantees increases when rules intended to prevent the program from being a pure
giveaway to companies are removed. This is the case, for instance, when as part of the stimulus bill of 2009, the
government lifted the subsidy fees for 1705 loans. This move increases the cost to taxpayers and attracts high-risk
Loan guarantee programs can also have an impact on the economy beyond their cost to taxpayers.
Mal-investment—the misallocation of capital and labor—may result from these loan guarantee programs. In theory,
banks lend money to the projects with the highest probability of being repaid. These projects are often the ones
likely to produce larger profits and, in turn, more economic growth. However, considering that there isn’t an infinite
This government involvement can distort the market signals further. For instance, the data shows that private
investors tend to congregate toward government guarantee projects, independently of the merits of the projects,
taking capital away from unsubsidized projects that have a better probability of success without subsidy and a
more viable business plan. As the Government Accountability Office noted, “Guarantees would make projects [the
23. Government Accountability Office [GAO], DOE Loan Guarantees: Further actions are needed to improve tracking and review of applications,
(March 2012), accessed June 13, 2012, http://www.gao.gov/assets/590/589210.pdf.
24. King and Montgomery, “Let’s Reset,” 22.
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 8
federal government] assists financially more attractive to private capital than conservation projects not backed by
federal guarantees. Thus both its loans and its guarantees will siphon private capital away.”
This reallocation of resources by private investors away from viable projects may even take place within the same
industry—that is, one green energy project might trade off with another, more viable green energy project.
More importantly, once the government subsidizes a portion of the market, the object of the subsidy becomes a
safe asset. Safety in the market, however, often means low return on investments, which is likely to turn venture
capitalists away. As a result, capital investments will likely dry out and innovation rates will go down.
In fact, the data show that in cases in which the federal government introduced few distortions, private investors
The project was ultimately abandoned
However, this proves that the private sector invests money even when there is a chance that it could lose it. Private
investment in U.S. clean energy totaled $34 billion in 2010, up 51 percent from the previous year.
Finally, when the government picks winners and losers in the form of a technology or a company, it often fails.
First, the government does not have perfect or even better information or technology advantage over private
agents. In addition, decision-makers are insulated from market signals and won’t learn important and necessary
lessons about the technology or what customers want. Second, the resources that the government offers are so
addictive that companies may reorient themselves away from producing what customers want, toward pleasing
the government officials.
4. Crowding Out
To some (for example, those lucky enough to receive the loan guarantee), government money may seem to be free.
But it isn’t, of course. The government has to borrow the money on the open market too. This additional borrowing
Economists use the term “crowding out” to describe the contraction in economic activity associated with deficitfinanced
In addition, the competition between public and private borrowing raises interest rates for all borrowers, includ-
ing the government, making it more expensive for domestic investors to start or complete projects.
Over time, this could mean that American companies will build fewer factories, cut back on research and develop-
25. Wang, “ Federal Clean, Energy”
26. Wang, “Federal Clean Energy,” 15.
27. Peter Bradford, “Taxpayer Financing for Nuclear Power: Precedents and Consequences” (Nonproliferation Policy Education Center,2008)
28. Ben Casselman, Alaska Pipeline Scrapped, May 18, 2011, Wall Street Journal, http://online.wsj.com/article/SB10001424052748703509104
29. The Center for the Next Generation website, “Advanced Energy and Sustainability,” accessed June 13, 2012, http://www.tcng.org/programs/advanced-energy-and-sustainability.
Matthew Mitchell and Jakina Debnam, “In the End, We’re
all Crowded Out,” (working paper,
Mercatus Center at George Mason University,
MERCATUS CENTER AT GEORGE MASON UNIVERSITY 9
ment, and generate fewer innovations. As a result, our nation’s future earning prospects will dim, and our future
living standards could suffer.
In a 2003 speech to the National Economists Club in Washington, D.C., then–Federal Reserve Governor Edward
M. Gramlich argued that loan guarantee programs are unable to save failing industries or to create millions of jobs,
because—he explained—the original lack of access to credit markets is caused by serious industrial problems, not
vice versa. If an applicant’s business plan cannot be made to show a profit under reasonable economic assumptions,
Then why is the federal government still guaranteeing loans? One reason is it serves three powerful constituencies:
Politicians are able to use loan programs to reward interest groups while hiding the costs. Congress can approve
billions of dollars in loan guarantees with little or no impact to the appropriations or deficit because they are almost
entirely off-budget. Moreover, unlike the Solyndra case, most failures take years to occur, allowing politicians to
collect the rewards of granting a loan to a special interest while skirting political blame years later when or if the
project defaults. It’s like buying a house on credit without having a trace of the transaction on your credit report.
It is also easy to understand why companies and company executives benefit from these loans and may seek them
out. However, this shouldn’t obscure the fact that this preferential treatment comes at the expense of the taxpayer,
and ultimately at the expense of our market and political system.
But another potential beneficiary of these loans is the financial institutions that issue them. With other loan programs such as the SBA, there is evidence that lenders may have an incentive to favor borrowers that qualify for a loan with a government guarantee over those that do not.
How profitable is this? Testifying before Congress in April 2006, David Bartram, the president of the SBA Division
A 70 percent return on equity (RoE) is remarkably high. Right now, the five-year
average RoEs for the two biggest banks in America—Citigroup and Bank of America—are 16.2 percent and 14.5
More study is required to determine whether a similarly outsized return to financial institutions occurs with the
DOE program, but the parallels between the DOE and SBA programs suggest this is a possibility.
The Department of Energy’s loan guarantee programs have been the focus of much public attention since energy
company Solyndra went bankrupt last year, leaving taxpayers with a $538 million bill. Of equal concern to the
significance of this waste, however, is the distortion and incentives experienced by both lenders and companies
that participate in the government loan program, as well as the distortion of market signals. Further looking at
where the money is going, the evidence seems to go solidly against the idea that they are achieving their goals.
And the systematic economic harm done by rewarding companies that forgo value creation in favor of pursuing
financial benefit through the political system creates long term consequences for our economy and our country.
Veronique de Rugy, “Banking on the SBA,” Mercatus on Policy, Mercatus Center at George Mason University, Arlington, VA, 2007, http://
MERCATUS CENTER AT GEORGE MASON UNIVERSITY
ABOUT THE MERCATUS CENTER
The Mercatus Center at George Mason University is a research, education,
and outreach organization that works with scholars, policy experts, and
government officials to connect academic learning and real-world practice.
The mission of Mercatus is to promote sound inter disciplinary research
and application in the humane sciences that integrates theory and practice
to produce solutions that advance in a sustainable way a free, prosperous,
and civil society.
ABOUT THE AUTHOR
Veronique de Rugy is a senior research fellow at the Mercatus Center at
George Mason University. Her primary research interests include the U.S.
economy, federal budget, homeland security, taxation, tax competition,
and financial privacy issues. Her popular weekly charts, published by the
Mercatus Center, address economic issues ranging from lessons on creat-
ing sustainable economic growth to the implications of government tax and
MERCATUS CENTER AT GEORGE MASON UNIVERSITY
Green Energy Loans: Beyond the Solyndra
By Veronique de Rugy
June 22, 2012 3:47 P.M.
I testified before Congress earlier this week about the Section 1705 loan guarantee
program of the Department of Energy. That’s the loan program that guaranteed $538
million in loans for the now-bankrupt energy company Solyndra. I came strongly
against these DOE loan-guarantee programs because, among other reasons, they
introduce distortions to market signal. For the record, I think all loan guarantee
programs by the government should be abolished —not just energy.
It’s interesting to look at the flow of Department of Energy loans to evaluate who
receives them and whether the department is meeting its stated policy objectives, such
as promoting new start-ups or companies that have a hard time accessing capital, and
encouraging the creation of green jobs.
Since 2009, Department of Energy has guaranteed $34.7 billion in loans, 46 percent
through the 1705 loan program, 30 percent through the 1703 program, and 14 percent
through the Advanced Technology Vehicles Manufacturing loan program.
The data show that:
• 26 projects were funded under the 1705 program, with guarantees of roughly $16
billion in total.
• Some 2,378 permanent jobs were claimed to be created under the program. This
works out to a taxpayer exposure of $6.7 million per job.
• The recipient of the most 1705 loans is NRG Energy, Inc. NRG Energy received a
$3.8 billion guarantee (23.7 percent of the overall amount guaranteed under 1705).
• Four companies received 64 percent, or $10.3 billion, of the total amount
guaranteed under the 1705 program.
• 90 percent of loans went to subsidize large and well-established companies
In most cases it’s not start-ups, like Solyndra, that received the loan guarantees, but
large established companies that are likely able to get access to large amounts of capital.
It wouldn’t be under the extremely favorable terms that the government guarantee
allows them to get, but they would get capital. Also, they would likely have to put down
more equity relative to debt than they do with the 1705 loan program. In other words,
the program encourages these large companies to leverage more than the open market
would allow them to. I thought we had learned the hard way that too much leverage
isn’t a good thing, but apparently not.
More important, in the process of looking into these loans, I realized the level of double
-dipping that these companies are involved in, too. As I explained in my testimony:
For instance, in addition to the $538 million it received under the
1705 loan program, Solyndra benefited from a $10.3 million loan
guarantee that the Ex-Im Bank extended to a Belgian company
(described in the Ex-Im deal data as “Zellik Ii Bvba”) to finance a
sale of Solyndra products.
Solyndra isn’t alone. First Solar’s Antelope Valley project received a
$646 million 1705 loan in 2011 through its partner Exelon, and per
my calculation from the Ex-IM Bank FOIA deal data information for
Page 3 of 3Green Energy Loans: Beyond the Solyndra Drama – By Veronique de Rugy – The Corner …
FY2011, the com- pany also scored $547.7 million in loan
guarantees to subsidize the sale of solar panels to solar farms
More troubling is the fact that some of the Ex-Im money went to a
Canadian company named St. Clair Solar, which is a wholly owned
subsidiary of First Solar. St. Clair Solar received a total of $192.9
million broken into two loans to buy solar panels from First Solar. In
other words, the company received a loan to buy solar panels from
itself. Incidentally, First Solar also received a $16.3 million loan
from the government in 2010 to expand its factory in Ohio.
But then there is the case of NRG Energy. The company received a $3.8 billion
guarantee and, throughout different companies, received 39 different grants under the
Recovery Act. It is also scheduled to receive $431 million from the Department of
Treasury along with multiple different benefits are the state and local level.
Examples of companies benefiting from multiple assistance programs initiated during
this period abound.
While there is no doubt that the deals are lucrative for the companies involved,
taxpayers have a lot to lose. Further, double-dipping provides evidence that businesses
will be tempted to steer away from productive value creation for society and instead
work on narrowly serving political interests for financial gain.
My testimony is here, and here is the video. I was testifying next to four CEOs,
including the head of NRG Energy. There was also serious questioning about why
Congentrix, a wholly-owned subsidiary of financial giant Goldman Sachs, needs the
help of government and political influence.
Panel unveiling docs on DOE aid recipients
By ANDREW RESTUCCIA | 6/19/12 10:11 AM EDT
An Energy Department employee used a private email
address to send confidential information to a company
that went on to get a $1.4 billion partial loan guarantee
from the agency, according to one of a series of
documents that House Republicans plan to highlight
The documents are the latest effort by the House
Oversight and Government Reform Committee to show
that corporate coziness in DOE’s clean energy
programs has gone beyond Solyndra.
The email (https://www.politicopro.com/f/?f=9927&inb) from
June 3, 2011, obtained by POLITICO, was sent by Peter O’Rourke, a contractor who served as an adviser to DOE’s
loan office, to Drew Torbin, vice president of renewable energy for the industrial real estate company Prologis, and
Jonathan Plowe, an official at Bank of America Merrill Lynch.
“please do not send beyond two of you. this is very important,” wrote O’Rourke, using a private Gmail account. “feel
free to use the concepts we articulate in your own words, if you don’t already have this in your message.”
The email included a 13-page presentation outlining the Energy Department’s messaging on Prologis’s application for
a $1.4 billion guarantee to finance 733 megawatts of rooftop solar generation in 28 states and Washington, D.C.,
through what the company calls Project Amp. The presentation was marked “confidential treatment requested.”
DOE officials said the documents reveal nothing new.
“The department asking a company to verify information about its application or sending them information about their
own project is hardly unusual or surprising,” the Energy Department said Monday night. “While the documents simply
rehash old issues the committee has already covered, they do offer even further proof that the department’s decisions
about loans were based on a thorough, technical consideration of the facts and merits of the case ? and nothing
The department approved the conditional loan guarantee for Project Amp later in June, then finalized the agreement
in September. Prologis has said the project is funded with equity from NRG Energy and Prologis as well as debt
financing through Bank of America.
POLITICO also obtained
emails from Sept. 21, 2011 (https://www.politicopro.com/f/?f=9928&inb) — also uncovered by
committee Republicans — that appear to show Prologis and Energy Department officials discussing changes to a
document certifying that the company had begun construction. The document alludes to the fact that the project’s first
phase was originally intended to use Solyndra’s solar equipment, before Solyndra went bankrupt last year.
have alleged (https://www.politicopro.com/story/energy/?id=9357) that DOE may have backed Project Amp to
help Solyndra, but department officials have strongly rejected that claim. Energy Secretary Steven Chu also denied it
Page 2 of 3Panel unveiling docs on DOE aid recipients – Andrew Restuccia – POLITICO.com
in February (https://www.politicopro.com/story/energy/?id=9535) — saying that, to the contrary, he expressed concern
about Prologis’s planned reliance on Solyndra because “I didn’t know how long Solyndra would be there.”
A GOP congressional source said Monday that the new documents “show that DOE officials were entirely too close
with Prologis, giving the company access to pre-decisional information and encouraging the company to make edits
to internal documents.”
Committee Republicans are expected to question Prologis co-CEO Walter Rakowich about the email at a
subcommittee hearing (http://oversight.house.gov/hearing/the-obama-administrations-green-energy-gamble-part-ii-were-all-the-
The hearing is also slated to include testimony from Cogentrix CEO Robert Mancini, NRG CEO David Crane, Ormat
Technologies CEO Yehudit Bronicki and Veronique de Rugy, senior research fellow at the Mercatus Center at
George Mason University.
This article first appeared on
POLITICO Pro (http://www.politicopro.com) at 8:51 p.m. on June 18, 2012.
Waxman Complaint Letter to Congress:
DOWN THE DOCUMENT HERE:
February 28, 2012
Secretary Steven Chu
U.S. Department of Energy
Dear Secretary Chu,
Today Bright Automotive, Inc will withdraw its application for a loan under the ATVM program administered by your department. Bright has not been explicitly rejected by the DOE; rather, we have been forced to say “uncle”. As a result, we are winding down our operations.
Last week we received the fourth “near final” Conditional Commitment Letter since September 2010. Each new letter arrived with more onerous terms than the last. The first three were workable for us, but the last was so outlandish that most rational and objective persons would likely conclude that your team was negotiating in bad faith. We hope that as their Secretary, this was not at your urging.
The actions – or better said “lack of action” — by your team means hundreds of great
manufacturing and technical jobs, union and non-union alike, and thousands of indirect jobs in Indiana and Michigan will not see the light of day. It means our product, the Bright IDEA plug-in hybrid electric commercial vehicle, will not provide the lowest total cost of ownership for our commercial and government fleet customers, saving millions of barrels of oil each year. It means turning your back on a bona fide step forward in our national goal to wean America away from our addiction to foreign oil and its implications on national security and our economic strength.
In good faith we entered the ATVM process, approved under President Bush with bi-partisan Congressional approval, in December of 2008. At that time, our application was deemed “substantially complete.” As of today, we have been in the “due diligence” process for more than 1175 days. That is a record for which no one can be proud.
We were told by the DOE in August of 2010 that Bright would get the ATVM loan “within
weeks, not months” after we formed a strategic partnership with General Motors as the DOE had urged us to do. We lined up and agreed to private capital commitments exceeding $200M – a far greater percentage than previous DOE loan applicants. Finally, we signed definitive agreements with state-of-the-art manufacturer AM General that would have employed more than 400 union workers in Indiana in a facility that recently laid-off 350 workers. Each time your team asked for another new requirement, we delivered with speed and excellence.
Then, we waited and waited; staying in this process for as long as we could after repeated, yet unmet promises by government bureaucrats. We continued to play by the rules, even as you and your team were changing those rules constantly – seemingly on a whim.
Because of ATVM’s distortion of U.S. private equity markets, the only opportunities for 100 percent private equity markets are abroad. We made it clear we were an American company, with American workers developing advanced, deliverable and clean American technology. We unfortunately did not aggressively pursue an alternative funding path in China as early as we would have liked based on our understanding of where we were in the DOE process. I guess we have only ourselves to blame for having faith in the words and promises of our government officials.
The Chairman of a Fortune 10 company told your former deputy, Jonathan Silver, that this
program “lacked integrity”; that is, it did not have a consistent process and rules against which private enterprises could rationally evaluate their chances and intelligently allocate time and resources against that process. There can be no greater failing of government than to not have integrity when dealing with its taxpaying citizens.
It does not give us any solace that we are not alone in the debacle of the ATVM process. ATVM has executed under $50 million of transactions since October of 2009. Going back to the creation of the program, only about $8 billion of the approved $25 billion has been invested. In the meantime, countless hours, efforts and millions of dollars have been put forth by a multitude of strong entrepreneurial teams and some of the largest players in the industry to advance your articulated goal of advancing the technical strength and clean energy breakthroughs of the American automotive industry. These collective efforts have been in vain as the program failed to finance both large existing companies and younger emerging ones alike.
Our vehicle would have been critical to meet President Obama’s stated goal of one million plugin electric vehicles on the road in 2015 and his commitment to buy 100 percent alternative fueled vehicles for the Federal Fleet. So, we are not the only ones who will be
The ineffectiveness of the DOE to execute its program harms commercial enterprise as it not only interfered with the capital markets; it placed American companies at the whim of approval by a group of bureaucrats.
Today at your own ARPA-E conference, Fred Smith, the remarkable leader of FedEx, made
the compelling case to reduce our dependence on oil; a product whose price is manipulated by a cartel which has caused the greatest wealth transfer in our history from the pockets of working people and businesses to countries, many of whom are not our allies. And yet, having in hand a tremendous tool for progress in this critically strategic battle — a tool that drew the country’s best to your door — you failed not only in the deployment of funds from ATVM but in dissipating these efforts against not just false hope, but false words.
For us, this is a particularly sad day for our employees and their families, as well as the
employees and families of our partners. We asked our team members on countless occasions to work literally around the clock whenever yet another new DOE requirement came down the pike, so that we could respond swiftly and accurately. And, we always did.
Reuben Munger Mike Donoughe