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 According to a report by the Department of Energy, interest
payments to the government from projects funded by the Loan Programs
Office were $810 million as of September - higher than the $780
million in losses from loans it sustained from startups including
Fisker Automotive, Abound Solar and Solyndra, which went bankrupt
after receiving large government loans intended to help them bring
their advanced green technologies to market.
The report's findings are more of a political victory than a
financial one. It took the program three years to break even after
Solyndra's failure, while during that same time the Standard &
Poor's 500 index increased 67 percent.
Still, the federal loans program is a success for taxpayers, judging
by the numbers in the new report, the DOE said. After Solyndra's
2011 collapse, the program was sharply criticized by Republican
lawmakers as a waste of public money and a fountain of cronyism. The
outcries mounted as others in the program failed, and the DOE issued
no new loans between late 2011 and this year.
"Taxpayers are not only benefiting from some of the world's most
innovative energy projects... but these projects are making good on
their loan repayments," Peter Davidson, executive director of the
Loan Programs Office, said in an interview on Wednesday. Davidson
took over the loan program in May of 2013.
 Under the program, the DOE issues a loan guarantee for about 50 to
70 percent of a project's cost. The borrower then secures a loan
from either the U.S. Treasury or a private lender. Most of the
program's loans have come from the Treasury, Davidson said.
The losses are not expected to rise significantly, while "every
month money continues to roll in" from interest payments, Davidson
said.
"We feel very confident that going forward our portfolio is much
less risky than it has been," Davidson said.
That is because most of the projects that received government loans
are large power plants that are now feeding electricity into the
grid, Davidson said. They include massive photovoltaic solar and
solar thermal power plants in California and Arizona, wind farms and
geothermal energy facilities.
Since DOE approved loans for the five utility-scale photovoltaic
projects, 17 more have been funded by private investors who would
not have taken on that risk five years ago, Davidson said.
"The loan guarantee program has been successful in bringing to
market good projects with good credit support that absolutely would
not have been built," said a spokesman for NRG Energy Inc, an energy
company that owns three solar power plants that received DOE loan
guarantees.
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The DOE's loan program was created in 2005 under the Bush
Administration, but its program for renewable energy projects was
funded in 2009 as part of the Obama Administration's economic
stimulus, the American Recovery and Reinvestment Act.
The DOE also approved loans for next-generation vehicles that funded
both the defunct Fisker as well as Tesla Motors Inc, which last year
repaid its $465 million government loan 9 years early.
Of the $30.3 billion in loans and loan guarantees issued by the Loan
Programs Office, $21.71 billion has been disbursed. At least one
company has yet to draw down its DOE loan.
Solar wafer maker 1366 Technologies Inc was required under the terms
of its loan to fund a small factory itself before it could tap its
government money to finance a larger facility. It expects to break
ground on that factory early next year.
In the meantime, the promise of the DOE loan guarantee gave private
investors the confidence to put up nearly $90 million for the
smaller facility.
"Those funds would not have been there if the DOE had not been there
as a partner," Chief Executive Frank van Mierlo said in an
interview.
Losses make up 2.28 percent of the loan program's total commitments,
or 3.6 percent of the amount disbursed.
The government has not recovered any funds from Solyndra. It's $528
million loan makes up most of the program's losses.
The government recovered $53 million from Fisker, which received
$192 million of its $529 million loan commitment. Fisker's assets
were acquired by Chinese auto parts producer Wanxiang in February
for $149.2 million.
This year, DOE began lending money again. They have programs in the
works that will support both renewable energy and fossil fuel
projects. In February it approved $6.5 billion in loan guarantees to
build two nuclear reactors in Georgia, and it issued a conditional
$150 million commitment to help build a wind project off the coast
of Cape Cod, Massachusetts.
(Reporting By Nichola Groom; Edited by Ronald Grover and Ken Wills)
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