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House probing $528M loan to failed solar company

September 14, 2011 12:26:11 AM PDT
Obama administration officials are answering questions on why the government loaned over $500 million to a now-bankrupt solar panel manufacturer.

California-based Solyndra Inc. collapsed two weeks ago. It has filed for bankruptcy, laying off 1,100 workers.

Solyndra was cited by President Barack Obama as an example of how the economic stimulus bill would increase employment through investments in renewable energy. But it couldn't compete with foreign manufacturers of solar panels in the U.S. and the European market dried up.

Lawmakers want to know why government officials thought the company was a good bet, and whether politics played a role in the loan.

"Our investigation raises several questions about whether the administration did everything it could to protect taxpayer dollars," said the committee's chairman, Rep. Fred Upton of Michigan.

Federal officials told lawmakers that Solyndra went through three years of review, beginning with the Bush administration, before any taxpayer money was put at risk. Jonathan Silver of the Department of Energy said that the company was well positioned to succeed in 2009.

Texts of White House emails obtained by ABC News show that the administration had concerns, but still pushed for the president to endorse it personally.

Emails also appear to show senior staff at the White House Office of Management and Budget chafing about having to conduct "rushed approvals" of federal loan guarantees designed to help jumpstart the nation's renewable energy industry.

GOP lawmakers said the White House had scheduled a groundbreaking for Solyndra even before the Department of Energy had submitted its final paperwork on the terms of the loan to the OMB.

"We would prefer to have sufficient time to do our due diligence reviews and have the approval set the date for the announcement rather than the other way around," said one of the emails from an unnamed OMB aide to the office of Vice President Joe Biden.

Solyndra executives were also scheduled to testify on Wednesday, but their testimony was pushed back to next week.

The Associated Press contributed to this report.

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