Energy Department emails suggest White House misleading the public about green energy loans

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Michael Bastasch Contributor
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The House Oversight Committee has released a memorandum containing more emails that suggest the White House was putting political pressure on Department of Energy employees to fast track government-backed loan guarantees for green energy firms, despite the Obama administration having publicly denied that politics played any role.

“This memo outlines key information the Committee has recently uncovered that suggests statements by the President and others in his Administration were misleading and that the White House, senior Administration officials, and President Obama himself played key roles in the Loan Guarantee Program,” according to the memo.

“And these are decisions, by the way, that are made by the Department of Energy, they have nothing to do with politics,” President Obama told KUSA’s Kyle Clark last week.

Energy Secretary Steven Chu, White House senior adviser David Plouffe, and Loan Program Office Chief David Frantz have also previously said that politics played no role in the decision to issue loan guarantees, and projects were chosen based on their own merits.

“I am aware of no communication from White House to Department of Energy saying to make the loan or to restructure,” Secretary Chu testified before Congress in November 2011.

However, the public comments run counter to emails just released by the Oversight Committee, as well as previously released emails.

“Jonathan just said at our staff meeting that, opposite the message received on Thursday, AREVA is now a ‘go’ (seems on Friday POTUS himself approved moving it ahead),” wrote David Schmitzer, DOE LPO Director of Loan Origination, in an email dated March 1, 2010 to LPO Credit Advisor McCrea and others.

AREVA, a French nuclear power firm, was granted a conditional $2 billion loan guarantee for uranium enrichment services in May 2010.

“I am growing increasingly worried about a fast track process imposed on us at the POTUS level based on this chaotic process that we are undergoing…by designing the fast track process and having it approved at the POTUS level (which is an absolute waste of his time!) it legitimizes every element and it becomes embedded like the 55% recovery rate which also was imposed by POTUS,” writes DOE Loan Program Office (LPO) Credit Advisor Jim McCrea to LPO Executive Director Jonathan Silver in an email dated October 30, 2010.

Emails also indicate that Vice President Joe Biden’s office may have put pressure on DOE employees and contractors to push through projects.

“Pressure is on real heavy on SF [Shepherds Flat] due to interest from VP,” said an email dated September 9, 2010 from McCrea to DOE contractor Brian Oakley.

The Caithness Shepherds Flat wind project received a $1.3 billion loan guarantee in October 2010 to generate 845 megawatts of wind-generated electricity and create 400 construction jobs.

These new emails build on those released by COMPLETECOLORADO.COM suggesting White House political pressure in DOE’s decision to award Abound Solar a $400 million loan guarantee.

“You better let him know that WH wants to move Abound forward. Policy will have to wait unless they have a specific policy problem with abound,” wrote LPO Executive Director Jonathan Silver McCrea in a June 25, 2010 email regarding the now bankrupt and under criminal investigation Abound Solar.

A Daily Caller News Foundation investigation found that Abound knowingly sold faulty, underperforming solar panels that were prone to catching fire and may have misled lenders at one point in order to keep itself afloat.

“Our solar modules worked as long as you didn’t put them in the sun,” an internal source told The DC News Foundation.

Emails released by the committee also suggest that projects were moved forward to help Senate Majority Leader Harry Reid during his tough re-election campaign in 2010 against Republican challenger Sharron Angle.

“Since this is not going to go into the DOE, and just to be clear, the translation is: Reid may be desperate. WH may want to help. Short term considerations may be more important than longer term considerations and what’s a billion anyhow?” wrote McCRea in a December 5, 2009 email to LPO contractor Paul Barbian.

According to the memorandum, emails throughout 2010 suggest Nevada projects were prioritized and called “high profile” and were “tied to larger events,” or because the projects had Reid’s support.

The DOE 1705 loan program obligated $14.5 billion to 26 projects before the program ended in September 2011, with three of the loan recipients — Solyndra, Beacon, and Abound — declaring bankruptcy so far. Other companies are in dire financial straits and 22 projects received junk ratings due to their bad credit quality.

“The Administration has for too long attempted to distance itself from the management of the program and its failures- embracing the ribbon-cutting ceremonies and photo-ops, while blaming the bankruptcies and wasted taxpayer money on someone else,” said House Oversight and Government Reform Committee Chairman Republican Darrell Issa of California in a statement.

The White House, Office of the Vice President, and the Department of Energy have yet to respond to The Daily Caller News Foundation’s requests for comment.

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