On October 28, 2011, the White House Chief of Staff directed an independent review of the current state of the Department of Energy (DOE) loan portfolio, focusing on future loan monitoring and management. The review was conducted by Herb Allison, who has wide-ranging experience in the finance, business, and government sectors during a career in public and private service that spans four decades and both Republican and Democratic Administrations.
This independent report on the DOE Loan Guarantee programs confirms that the loan portfolio as a whole is expected to perform well and holds less than the amount of risk envisioned by Congress when it created and funded the program. The report also includes a number of recommendations on how to improve the management of the Department’s loan program and ongoing monitoring of the loan portfolio. The Department of Energy is reviewing the recommendations to determine the best way to use them to further strengthen the program.
DOE’s loan programs are generating $40 billion in private investment in America’s economy that is supporting 60,000 direct jobs and thousands more up and down the supply chain. With the help of this program, American workers will build wind, solar, geothermal and nuclear power plants across the country that will help power our economy for decades to come – as well as the next generation of automobiles that will reduce our dangerous dependence on foreign oil. And these numbers don’t include the investments made in the supply chain or from other investments made from projects that have been able to get financing because the loan program helped structure and establish a market for them.
When Congress first developed this program under the Bush Administration, the purpose was to help fund some high risk projects to put America at the cutting edge of innovation. There’s no question, as the report indicates, we expect more bumps along the road in emerging industries like clean energy. But as the President said in his State of the Union message, that’s not a reason to throw up our hands and cede the jobs of the future to China or Germany or anywhere else. We have subsidized oil companies for a century. It’s time to end the taxpayer giveaways to an industry that’s rarely been more profitable, and invest in a clean energy industry that’s never been more promising.
The report can be accessed here.