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Gloria Gonzalez

Gloria Gonzalez

Gloria is a writer for Environmental Finance.Environmental Finance is the leading global publication covering the ever-increasing impact of environmental issues on the lending, insurance, investment…

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DOE no Longer Able to Fund Clean Technology Ventures after Budget Cuts

The US Department of Energy's (DOE) days as a financier of clean technologies are over thanks to the Solyndra backlash, but budget cuts would have prevented the department from functioning in that role anyway, according to NRG Energy's chief executive.

"It was the headline for a good part of the year in 2011," David Crane, president and CEO of power generator NRG Energy, said of the Solyndra situation at the Jefferies 2012 Global Clean Technology Conference in New York on Wednesday. "In all likelihood it will be a headline into a good part of the year in 2012.

"While I think it's annoying to all of us to keep hearing people talk about Solyndra, my view is that Solyndra is just an issue in Washington,” he added. "I don't get any sense in terms of my dealings with people and consumers of solar power outside of Washington that Solyndra has discredited the solar industry."  

The lasting effect of Solyndra is that it will discredit the DOE as a source of venture capital financing for new clean-tech businesses, Crane said.

"But since the Department of Energy was going to be denied any funding for venture capital activities in the clean-tech industry because of overall budget constraints, I'm not sure it actually matters," he said. "I think Solyndra is more of an annoyance than a lasting issue for the industry."

Republicans in the energy and commerce committee of the House of Representatives have been investigating the DOE’s $535 million loan guarantee to Solyndra for a year, but the inquiry was expanded and propelled after the Fremont, California-based company filed for Chapter 11 bankruptcy last August.

Clean-tech sector losing bipartisan support

The Solyndra situation has highlighted the fact that support for the clean-tech sector has essentially become the domain of the Democratic Party, even though some of the earliest renewable portfolio standards were adopted by traditionally Republican states such as Arizona and Texas, Crane observed.

"Support for clean energy tech is no longer bipartisan and I think that is very unfortunate," he said. "I think all of us have to have that dialogue with people who are opposed."

The federal clean energy standard, for example, is "going absolutely nowhere", even though it was originally a Republican idea, because Republicans have run away from it since President Barack Obama embraced it in his State of the Union address, he said.

Crane noted that Project Amp, a major rooftop solar initiative that NRG has invested in which also received a DOE loan guarantee has been "faintly tied" to Solyndra.

"Notwithstanding what you read in the paper, I think [the project is] incredibly exciting," he said. "The growth potential from where we are now for rooftop is unlimited. Rooftop is where it's at in terms of solar."

Distributed solar generation and electric vehicles are key areas that have the potential to capture the attention of US consumers, Crane said.

"While there are a lot of parts to the clean-tech sector, I don't think all parts are created equal in terms of the overall health of the sector," he said.

By. Gloria Gonzalez

Source: Environmental-Finance




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  • Sue Jones on March 19 2012 said:
    The point that needs to be made is that engineers need to pick technologies. Not accountants and political hacks. The govt SHOULD be in the position of funding innovative companies, but not willy nilly with no technical due dilligance. DARPA and the Navy can pick winners. So can lots of experts. But they were not engaged for the disasterous DOE funding decisions.
    Nature cannot be fooled, but lawyers and accountants can be. That's why investments in technology need to be picked by technologists.

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