On September 1, 2011, Solyndra, a solar energy start-up and recipient of an Energy Department loan guarantee, declared bankruptcy. While this event is deeply disappointing, at the time the loan guarantee was issued, Solyndra was widely seen as a promising and innovative company:
- Solyndra was named one of the world’s “50 Most Innovative Companies” in 2010 by MIT’s Technology Review and included in the Wall Street Journal’s “The Next Big Thing: Top 50 Venture Backed Companies.”
- Private investors, after conducting their own careful review of Solyndra, put $1 billion of their own private capital behind the company.
- Solyndra reported sales growth of 40% from 2009 to 2010, from $100 to $140 million.
- This loan was pursued by both the Bush and Obama Administrations.
- The Solyndra loan underwent years of rigorous internal and external review before being approved. It attracted venture capital support and was thoroughly vetted by objective, independent validators who believed this project was worthy of investment.
By any measure, solar manufacturing will be a huge market in the coming years – the only question is whether we want to compete for those jobs, or just give up in the face of a setback. The International Energy Agency projects that solar power will grow steadily, producing nearly a quarter of the world’s electricity within four decades.
- Conservatively, that means more than $3 trillion worth of solar panels will need to be manufactured – a vast economic and employment opportunity to be seized by countries that succeed in this sector.
Our competitors know this, and are playing to win.
- Last year the China Development Bank offered more than $30 billion in financing to Chinese solar manufacturers, about 20 times more than U.S.-backed loans to solar manufacturers.
- In 1995, the U.S. produced 40 percent of the world’s solar panels, compared to five percent today.
- In the last six years, China’s market share has grown from six percent to 61 percent.
When it comes to clean energy, we have a choice to make. We can compete in the global marketplace – creating American jobs and selling American products – or we can buy the technologies of tomorrow from abroad.
Our loan programs are today supporting a diverse portfolio of more than 40 projects that plan to employ 60,000 Americans and give us a chance to compete and succeed in the global clean energy race. These include the largest wind farm in the world, the first new nuclear power plant in the United States in three decades, and the largest solar generating stations in the world.
Historically, our government has supported emerging industries -- from transcontinental railroads to aviation to the microchip. These investments strengthened our Nation and leveraged the private investments that drove our prosperity. Now is not the time to stop investing in our Nation’s future.
Flashback: Congressional Pressure to Accelerate Loan Program
While some in Congress and the media are now alleging that Department of Energy rushed the application, as far back as 2007 and as recently as July 2010, Republicans in Congress were complaining about the slow pace of reviewing and approving loan applications. In fact, during Secretary Chu’s 2009 confirmation hearings, Republicans in the Senate pressed Secretary Chu to make accelerating the loan program a priority. Learn more.
INFOGRAPHIC: Timeline of the Energy Department's Review and Approval Process for the Solyndra Loan (Download)