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US House votes to end renewables loan program

14 Sep 2012, 7.56 pm GMT

Washington, 14 September (Argus) — The US House of Representatives today approved legislation to phase out the federal loan guarantee program for renewables and advanced energy projects.

The House voted 245-161 to approve the bill, which now goes to the Democratic-controlled Senate where it is unlikely to see any further action. The election campaign season House vote was largely along party lines, though 22 Democrats voted for the bill. Just four Republicans voted against it.

The “No More Solyndras Act,” HR 6213, would prohibit the Department of Energy (DOE) from issuing loan guarantees to any projects that applied after December 2011. It would also require additional Treasury Department review before DOE can approve any applications submitted before the end of 2011.

Republicans said the bill was needed to bring an end to the “failed” program, though, as Democrats noted repeatedly, the legislation would technically allow DOE to still issue up to $34bn worth of loan guarantees to 50 projects grandfathered into the program.

“This bill prevents any costly repeats of Solyndra by prohibiting any new loan guarantees and subjecting pending ones to very stringent safeguards,” House Energy and Commerce Committee chairman Fred Upton (R-Michigan) said.

Republicans introduced the bill this year to avoid more “disasters” like the awarding of a $535mn loan guarantee to Solyndra, a solar panel manufacturer in California that filed for bankruptcy last year. Two other recipients of smaller loan guarantees have since also filed for bankruptcy.

Solyndra received its loan guarantee under the section 1705 program created by the 2009 stimulus bill. That program ended last year. But DOE is reviewing applications for the previously existing section 1703 program, under which remaining loans could be awarded.

The vote came after House Democrats unsuccessfully tried to amend the bill. A motion by representative Ed Markey (D-Massachusetts) would have prevented the bill from taking effect if the federal production tax credit for wind energy expires as scheduled at the end of the year. The House rejected the motion on a 175-234 vote.

“Republicans say they want no more Solyndras, but what they really want is no more clean energy solutions. They do not want the newest clean energy technologies to compete with coal, nuclear, oil and other fossil fuels,” Markey said.

While Republicans say the bill will bring about an orderly end to the program, the vote was not enough to satisfy some conservative groups that want the loan program shut down immediately. “To truly protect taxpayers all loan guarantees must stop. This bill misses the mark and jeopardizes billions of taxpayer dollars,” Taxpayers for Common Sense president Ryan Alexander said.

The group and several other conservative organizations urged the House earlier this week to amend the bill to bring about a faster end to the loan program.

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