WASHINGTON -- House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) laid into Energy Secretary Steven Chu on Thursday for missing warning signs of Solyndra's demise before approving a $535 million loan for the solar company.
But the harsh words from Upton, a critic of the Solyndra loan, rang somewhat hollow given that he sought those same funds for another solar company in his state visibly on its way to collapse.
The Washington Post reported Wednesday on Upton's lobbying for Energy Department loans for United Solar, a Michigan solar company that announced last week it is halting its operations. The firm first hit bumps in 2009, when parent company Energy Conversion Devices (ECD) announced a restructuring plan that included 400 layoffs. Last week, the Detroit Free Press described the two companies as "dying," with stocks at half where they were three years ago and hundreds more people on track to be laid off.
But the kicker here, in the context of GOP complaints about Solyndra, is the stream of warning signs that United Solar was heading downhill -- and the response to such warnings from Upton. As the Post reports, just two weeks after ECD announced restructuring and layoffs, Upton and 13 other Michigan lawmakers sent a Dec. 17, 2009 letter to Chu requesting loans for United Solar, calling it a project "worthy of serious consideration" for investment.
The Energy Department's loan guarantee program "parallels our state's strategy to advance key energy sectors," reads the letter signed by Upton, and United Solar is one of "several key Michigan opportunities for partnerships under this program."
In addition, in the months prior to Upton's letter, local newspapers were documenting the company's financial woes. The Battle Creek Enquirer reported in August 2009 that United Solar halted construction on a new facility and had "yet to say when it will resume building, citing poor market demand." The paper reported on Dec. 3, 2009 that 425 layoffs at the company suggest it "is unlikely to move ahead with production in Battle Creek anytime soon." Two days later, Grand Rapids Press reported that cuts to the company's workforce would "save $17 million at a time of dropping sales of its thin-film solar cells."
United Solar never did get federal funds. But you wouldn't know that Upton had pushed to make that happen by his performance in Thursday's hearing, where the Michigan Republican lambasted Chu for approving loans for Solyndra without taking enough precautions.
"The number of red flags about Solyndra that were raised along the way -- many from within DOE -- and either ignored or minimized by senior officials is astonishing," Upton told Chu in his opening remarks.
"We have heard from President Obama, and even from you, Secretary Chu, that nobody had a crystal ball and no one could have predicted Solyndra's demise," he continued. But there were several "red flags DOE could have acted on to limit taxpayer losses. Instead, at every opportunity, Solyndra and DOE officials, including Secretary Chu, publicly assured the American people that Solyndra was on track and would eventually thrive, right up until the time that Solyndra declared bankruptcy. They continued telling this story even when they clearly should have known it was not the case."
Upton concluded that he will "get to the bottom of why taxpayers are now on the hook for a half billion dollars."
The irony of Upton's involvement in United Solar wasn't lost on Rep. John Dingell (D-Mich.), who noted during the hearing that several members of Congress have sought Energy Department loans for clean energy projects in their districts.
"I happen to know I did. As a matter of fact, I did with my good friend Mr. Upton," Dingell said. "We submitted it together for a project in Michigan, which curiously enough happens to be in trouble because of a similar market collapse."
Committee spokeswoman Alexa Marrero said it is ultimately up the Energy Department, not Upton or other lawmakers, to thoroughly vet applications and decide which projects deserve funding.
"DOE's job is to scrutinize applications and identify the best participants, and that's what the Michigan delegation asked them to do," Marrero said in a statement. "Many in Congress questioned whether the stimulus would produce the promised jobs -- at the same time, members on both sides of the aisle wanted to see jobs created and folks put back to work, especially in Michigan."
"The real tragedy is the loss of jobs and taxpayer dollars, which is why the committee is so determined to get to the bottom of this loss so that it never happens again," she said.
Mike McAuliff contributed to this report.
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