Federal Loans Fund Big-Ticket Energy Projects at Firms Outside of U.S

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Published September 23, 2011

Among the biggest recipients on the Department of Energy’s controversial list of loans to renewable energy companies like the failed Solyndra Inc. are a number of non-U.S. firms whose big-ticket energy projects will cost taxpayers billions of dollars — but will generate no more than a few hundred permanent U.S. jobs.

Some of the companies employ complex solar technologies that cost more than twice as much as any other land-based renewable system, including nuclear.

The huge cost and relatively low long-term employment payoff for the investments could cast doubt on the Obama administration’s claims that big investments in new green technologies will lead the U.S. to innovative parity with countries like China, and also create significant long-term employment gains for the U.S. economy.

As recently as July, for example, President Obama declared in a radio address that “we’re accelerating the transition to a clean energy economy and doubling our use of renewable energy sources like wind and solar power — steps that have the potential to create whole new industries and hundreds of thousands of new jobs in America.”

A case in point is Abengoa Solar, Inc., a Spanish-owned firm that has received more than $2.6 billion in federal loan guarantees from DoE for two power-generating complexes, with the most recent $1.2 billion guarantee closing just this month. Abengoa’s press releases tout the thousands of construction and other jobs that will be result from the projects, one in the Mojave Desert in California, the other southwest of Phoenix.

Nonetheless, the DoE’s own website reveals that the two projects will permanently employ no more than 130 people after completion.

Abengoa’s entire staff worldwide, according to its 2010 annual report, was 526 employees.

The Solyndra scandal erupted at the end of August, when the company filed for bankruptcy about two years after it was given a loan guarantee from the Department of Energy for nearly $530 million, followed by a loan for the guaranteed amount from the Federal Financing Bank.

Loan guarantees under DoE’s so-called 1703 program are given for “innovative clean energy technologies that are typically unable to obtain conventional private financing due to high technology risks.”

In the case of at least one Abengoa property, its Mojave Desert project, the administration’s involvement apparently goes well beyond a loan guarantee. In its 2010 annual report, the Spanish company reports that it was subsequently able to obtain a loan from the U.S. Treasury’s Federal Financing Bank, which according to its website has “statutory authority to purchase any obligation issued, sold, or guaranteed by a federal agency to ensure that fully guaranteed obligations are financed efficiently.”

It may also be debatable whether Abengoa should be able to get federal financing guarantees for its projects purely on the grounds that its technology is so innovative that private sector funding would not be forthcoming. According to its annual report, the use of cutting edge high technology in marketing and creating solar energy facilities is one of the key elements of Abengoa’s business model, and a part of its global competitive advantage in solar energy construction.

“This proprietary technology development and a strategy of continued investment in R&D preserves Abengoa Solar’s leadership position,” the report says. It gives the company “a competitive advantage in an industry where technological change happens quickly, a better chance to offer competitive technologies in the future, as well as an adaptable portfolio of solutions and components for each project or market.”

Click here for the annual report

Several efforts by Fox News to contact Abengoa executives to discuss the company’s U.S. projects prior to this article’s publication were unsuccessful.

Continue reading here………..

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Related Link

Report Reveals EPA has Ramped Up Foreign Handouts, Sending Millions to China, Russia, and the United Nations Despite Record Deficits, Looming Debt Ceiling, and Soaring Unemployment

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Want to Know WHAT $$ go OUT of Washington? “Raising the Debt Ceiling” For Dummies

Obama isn’t spending our money to help improve the lives of America’s poor, seniors, veterans, homeless, minorities or others we care deeply about. Here’s just a taste of his real priorities… where he’s been spending our money and what our kids and grandkids will be expected to repay for decades to come:

OVERSEAS

PROPAGANDA ORGANIZATIONS

GROW GOVERNMENT

GLOBAL WARMING

$880 Billion is being spent on these items alone in 2011.

LINK

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“The American Republic will endure until the day Congress discovers that it can bribe the public with the public’s money.”

–  Alexis de Tocqueville

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