GOP Presses Secretary Chu & Chu Challenges Congress

Mar 20: According to a release from the House Committee on Oversight and Government Reform, Chaired by Representative Darrell Issa (R-CA) reports authored by the Republican staff show a pattern of "mismanagement, high-risk lending to green energy firms, and shoddy work performed under Department of Energy (DOE) weatherization programs."

    Chairman Issa said one report documents that "DOE disregarded its own taxpayer protections, ignored lending standards and eligibility requirements, and as a result, amassed an excessively risky loan portfolio -- some $14.5 billion in total loan guarantees were authorized. Oversight investigators also identified instances when DOE faced barriers to completing a loan and simply sought to justify and overcome those regulatory barriers rather than giving the barriers due consideration. In one glaring example, the report shows how DOE appears to have manipulated analysis and strategically modified evaluations in order to issue loans to First Solar that would make the project qualify under the statutory and regulatory guidelines."

    A related Republican Committee report also documents "shortcomings" from a $5 billion federal weatherization improvement program funded through the Department of Energy. According to the report, the program "[R]epresents the kind of failure that materializes when you have an economic stimulus strategy contingent upon asking the federal bureaucracy to absorb billions of dollars when the structural infrastructure to administer, disseminate and manage that influx of new money is not put in place." The release indicates that, "The report documents faulty construction and retrofitting that left consumers with faulty home electrical, ventilation, insulation and other systems. It also includes a series of photographs showing shoddy workmanship in several states."

    Chairman Issa added, "These reports document a Department of Energy seemingly unprepared to deal with the exponential increase in taxpayer funds it received under the stimulus, leading to serious questions of waste and abuse.  Taxpayers are right to expect better from the Department of Energy and the Obama Administration and to seek protections that this type of approach can be avoided in the future."

    In an opening statement at a hearing today to investigate DOE loan and funding programs with Secretary Steven Chu, Chairman Issa said, "Today the price of gasoline is approaching $4.00 per gallon, twice its level in 2009. American consumers understandably ask what the Department of Energy and the Obama Administration have done to address this.  But during the Obama Administration, you might say the DOE has been DOA when it comes to delivering affordable energy to consumers. 
 
    "A report released today by the Committee on Oversight and Government Reform paints a startling picture of mismanagement at the Department of Energy. From the very inception of the Obama Administration's $14.5 billion loan program, warning signs pointed to a likely loss of taxpayer dollars -- these signs were largely ignored by Administration officials seemingly more interested in picking political winners and losers than addressing American consumers' need for abundant and affordable energy. There appears to be a significant amount of evidence indicating that DOE manipulated analyses and strategically modified evaluations in order to get loans out the door. . . By addressing the issues raised at today's hearing, we can help put our country back on the path to achieve these two goals and deliver real benefit to the American people."

    Yesterday (March 19), Representative Elijah Cummings (D-MD), the Ranking Member of the House Committee on Oversight and Government Reform, sent a detailed letter to Chairman Issa asking him "to refrain from making unsubstantiated allegations against Department of Energy employees and to correct the record for multiple claims that have proved inaccurate after further investigation." Rep. Cummings indicated, "Over the past year, Issa has launched 11 investigations into the Department and its employees, sent at least 46 document requests, and received more than 300,000 pages of documents. Many of these investigations, however, have been based on allegations that were made with little or no evidence to support them when they were made. For example, Issa has repeatedly accused Department employees of engaging in illegal criminal conduct, disregarding the law, and basing decisions on partisan politics and corruption -- all claims that turned out to be inaccurate." His letter provides documentation for his concerns.

    Rep. Cummings said, "As a result of our Committee's extremely broad jurisdiction, we have a tremendous opportunity to perform constructive oversight of the Department of Energy and the energy industry to promote the bipartisan goal of energy independence for our nation. Although I fully support aggressive oversight to ensure that government programs work effectively and efficiently, I believe the Committee should refrain from making accusations without evidence to support them and should correct the record when claims turn out to be inaccurate. Only in this way will we be able to uphold the integrity of the Committee and protect the reputations of officials who have dedicated their careers to serving this nation."

    Secretary Chu testified at the hearing, "As part of the Recovery Act, the Energy Department received more than $35 billion to

help jolt the economy and to position the United States to lead in the global clean energy race. By the end of fiscal year 2010, the Department had obligated virtually 100 percent of its Recovery Act contract and grant funds. We are supporting more than 15,000 projects across the country. And since the summer of 2010, we have consistently supported between 40,000 and 50,000 direct jobs each quarter, and likely thousands more throughout the supply chain. . .

 

    "Oversight of our Recovery Act funds has been a top priority for the Department and me. We have put in place an aggressive monitoring system to ensure that the Department and its grantees spend Recovery Act funds wisely and that taxpayers get the value they deserve. . . He continued to provide an overview the extensive accomplishments of the Recovery Act in advancing energy efficiency and renewable energy initiatives.

 

    He concluded saying, "The Department of Energy's Recovery Act efforts are working: they've created jobs and put us in a stronger position to compete in the $260 billion global clean energy economy. Last year -- for the first time since 2008 -- the United States reclaimed the title from China as the world's leader in total clean energy investments. This welcome news comes with a huge caveat, however. Our comeback is due in large part to programs and tax incentives that have expired or are set to expire soon.

 

    "America has reached a crossroads and members of Congress have a big decision to make: We can play to win in the clean energy race -- investing in America's workers, industries, and innovations -- or we can wave the white flag and cede leadership to other countries that are investing in these industries. Trillions of dollars will be invested in clean energy in the coming decades, and countries around the world are moving aggressively to seize this economic opportunity. I believe the United States can and must win this race. The Recovery Act gave us a strong foundation to build on, but we must move forward with fierce urgency."

    Access the Republican Committee release (click here). Access a release and letter from Rep. Cummings (click here). Access links to the reports and Secretary Chu's testimony (click here). [#Energy/Efficiency, #Energy/Renewable]

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