Dept of Energy’s failure as a Solyndra‘s Venture Capitalist leads to Larger Loan with a Solyndra/Pelosi Connection
Solyndra cost the American taxpayer $535M and should be titled “The $535M Photo Opportunity”. The epic failure of this company will continue and should continue to be in the spotlight from now until the election next year. It is a text book case study in all things that can go wrong when the financial projection models tell a story of projected cash flow shortfalls in 2011 that fly in the face of political grandstanding by President Obama and Vice President Biden.
Solyndra also failed due to competition from Chinese firms for virtually the same product at a lower price which killed Solyndra’s sales. Where did the Chinese get this technology? They got it under a license agreement with General Electric who got it as a result of some work done at the Oak Ridge Tennessee National Lab. So connecting these dots it seems that we lent money to Solyndra to develop technology we already developed and paid for at Oak Ridge and sent to China for manufacturing.
It makes my head hurt!
The tip of the iceberg has received considerable coverage in the Media. Even the left leaning media outlets can’t spin or deny the scale and scope of the failure of Solyndra and its connections to the West Wing. The Office of Management and Budgets aka “the bean counters” sounded the alarm in 2009 which was largely ignored by the Department of Energy aka “the greenies” which ultimately approved the funding.
It is important that you have and review the reports from the House Committee on Energy and Commerce review of the circumstances and timeline surrounding the $535M loan to Solyndra. The SolyndraStoryFinalMemo document is an excellent summary of these events. The DocumentsEnteredIntoRecord document contain the eye opening emails between staffers and the pressure on them to wrap up the loan approval process to meet event scheduling deadlines aka as the photo opportunity. The final document SolyndraLoanGuaranteeMemo is at least an interesting read as it is addressed to the Democratic members of the subcommittee and is a text book example of political spin for the bruised and battered Administration.
Why is Solyndra the tip of the iceberg? When faced with the Solyndra failure the Department of Energy has done it again. DOE hastily approved an even larger loan to another firm backed by a number of private equity firms including one that employs a Pelosi relative and a former Solyndra Board of Directors member, Steve Mitchell.
“Despite the growing Solyndra scandal, yesterday the Department of Energy approved $1 billion in new loans to green energy companies — including a $737 million loan guarantee to a company known as SolarReserve:
SolarReserve LLC, a closely held renewable energy developer, received a $737 million U.S. Energy Department loan guarantee to build a solar-thermal project in Nevada.
The 110-megawatt Crescent Dunes project, near Tonopah, Nevada, will use the sun’s heat to create steam that drives a turbine, the agency said today in a e-mailed statement. SolarReserve is based in Santa Monica, California.
On SolarReserve’s website is a list of “investment partners,” including the “PCG Clean Energy & Technology Fund (East) LLC.” As blogger American Glob quickly discovered, PCG’s number two is none other than “Ronald Pelosi, a San Francisco political insider and financial industry polymath who happens to be the brother-in-law of Nancy Pelosi, the Minority Leader of the United States House of Representatives.”
But wait… there’s more! One of SolarReserve’s other investment partners is Argonaut Private Equity:
Steve Mitchell and Argonaut Private Equity might have a chance to recoup some of their losses in the Solyndra debacle now that the Department of Energy has given a $737 million dollar loan guarantee to a company backed by Argonaut that also lists Mitchell among its board of directors.
Mitchell served on the Solyndra LLC Board of Directors. He also serves as Managing Director for Argonaut Private Equity, a company that invested in Solyndra through the LLCs parent company.”
So since we all are investors in these companies as American taxpayers we should ask some simple questions.
Does this pass the smell test?
What will be Ronald Pelosi’s role and did Nancy Pelosi have any involvement over the loan approval to SolarReserve?
Is Steve Mitchell in any position to recover losses suffered by the Argonaut investment in Solyndra by the loan to SolarReserve?
What does the financial model show for SolarReserve? Did they prepare that one without any regard to working capital requirements like the initial Solyndra model?
I know we all feel helpless to effect how this Administration is spending our hard earned borrowed from China venture capital. What is important is that we continue to speak out, raise flags, ask hard questions of all involved in these decisions.
The Chief Executive Officer of a failed or grossly mismanaged firm typically either resigns or is fired by the Board of Directors. Mr. President YOU ARE FIRED as Chief Executive Officer of the United States of America. Unfortunately there is no severance package available. You spent it all.
Now don’t you feel better knowing how your money is being spent. Ouch, my head just esploded..