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When he is confronted about the failed green-energy loan program, President Obama deflects blame—pointing to “career bureaucrats” in the Department of Energy (DOE) who supposedly approved the loans that have become an embarrassment to the White House. 

For months, along with researcher Christine Lakatos, I’ve been reporting on, first, the junk-bond rated projects (such as Solyndra) that received fast-tracked approval from the DOE and, then the failed and troubled stimulus funded companies. Solyndra was just the tip of the iceberg. 

Embarrassment after embarrassment has come to light as the projects touted as the hope for America’s future have filed for bankruptcy, sent money and jobs overseas, and faced technical difficulties.

According to GAO March 2012 statistics (and emphasized in the June 19th Congressional hearing), "For the 460 applications to the Loan Guarantee Program (LGP), DOE has made loan guarantees for 7 percent and committed to an additional 2 percent."

And of the 26 projects that got the loans, 22 were junk-bond rated—meaning private investors wouldn’t fund them. So why did we, the taxpayers?

Of the 26 loans issued through just the 1705 LGP to 21 firms, virtually all of them have meaningful political ties (bundlers, donors, supporters, etc). Our research showed that at least 90% of the projects had close ties to the White House and other high ranking Democrats. Despite the obvious connection, President Obama has repeatedly denied any involvement—preferring to blame “career bureaucrats” who could take the fall with no political consequence.

In March, Energy Secretary Steven Chu, testified that, “We looked at the loans on their own merits.” Also, back in November 2011, he said: “I am aware of no communication from White House to Department of Energy saying to make the loan or to restructure.”

Just last week, on October 26, President Obama affirmed Chu’s position when he said: “Decisions made in the loan program office are decisions, by the way, that are made by the Department of Energy, they have nothing to do with politics.”

However, late Wednesday, the House Committee on Oversight and Government Reform released a new report of “over 150 emails that contradict statements by the President, Secretary Chu, and White House and DOE officials.” The emails reveal a series of questionable practices, including coercion, cronyism and, cover ups.

The Committee has been asking for the emails and additional testimony since the Solyndra story broke in September of 2011, but the DOE has been refusing to cooperate. Emails were finally leaked from former DOE employees. Some of the incriminating evidence includes the following:

1. From an email dated March 1, 2010 from David Schmitzer, DOE LPO Director of Loan
   Origination to LPO Credit Advisor McCrea and others: “Jonathan just said at our staff meeting that, opposite the message received on Thursday, AREVA is now a “go” (seems on Friday POTUS himself approved moving it ahead).”
2. From an email dated June 25, 2010, LPO Executive Director Jonathan Silver encourages LPO Credit Advisor Jim McCrea to remind a Treasury official of White House Interest in now bankrupt Abound Solar: "You better let him know that WH wants to move Abound forward. Policy will have to wait unless they have a specific policy problem with abound.”
3. From an email dated September 9, 2010 from LPO Credit Advisor McCrea to
   DOE contractor Brian Oakley: "Pressure is on real heavy on SF [Shepherds Flat] due to interest from VP.”

These emails are just a snippet of the 150 emails we are reviewing as a part of the just-released report. We have reported on each of the projects listed above and will report further.

We know that the Obama Administration operates from a “culture of corruption,” now we see that there is also a culture of deception within the White House walls. The White House green lies are bigger than innocent, little white lies; they are expensive green lies that have produced $34.7 billion in red ink for the taxpayers.

The Obama green energy program is the largest, most expensive, and deceptive case of crony capitalism in American history.

Back Story

As I was busy being "proud of myself" for making it on The Daily Caller (October 30th) with a "hit" piece featuring my "Obama Green-Energy Failures," I heard Newt Gingrich "On the Record with Greta Van Susteren” (Fox News Channel). Lo and behold, Gingrich had this to say, after noting that the rumor [more incriminating Benghazi emails were forthcoming], if true, would have a substantial impact on the presidential election, Gingrich pointed to another possible “October surprise” in the coming days.

“The other big story, I think, that is going to break is on corruption and extraordinary waste in the solar power grants and direct involvement by the Obama White House, including the president, in the solar panel grants involving billions of dollars, and I suspect that’s going to break Wednesday and Thursday of this week,” Gingrich added.

The next day, I received the above bombshell Intel in my inbox around 4:30 PM, and I was immediately in contact with Marita via emails, text, and on the phone –– thus we threw up this breaking news at Townhall.com [Emails Catch White House Lie on Green-Energy Loans], divulging just a snippet of data into the 150 internal emails released by the House Oversight Committee on October 31, 2012: Emails Contradict President Obama, Administration Officials on Energy Dept. Loan Program.

Cronyism*

Besides the obvious contradictions, coercion, and cover up, since April this year, we had already chronicled many of the green-energy, crony-corruption stories –– the driving forces behind the majority of the loans that flew out of the DOE. In fact the three firms/projects found in the "smoking gun" emails released by the House Oversight Committee –– that we decided to highlight in our breaking story –– we had already reported on since April 2012.

• As mentioned Kleiner Perkins as well as Al Gore's Generation Investment Management firm (GIM) also tied to the Spanish company Abengoa that received more than $2.8 billion in loans and grants—making them the second largest recipient of the $16 billion doled out through the DOE 1705 loan guarantee program.
• Khosla Ventures, where billionaire Vinod Kholsa, another big VC winner in the green taxpayer funded giveaway, that includes Ausra (listed here), Coskata that snagged a $250 million DOE loan as well as Nordic WindPower (also a Goldman Sachs investment) for $16 million, plus more. Vinod Khosla, an affiliated partner of Kleiner Perkins, whose firm Khosla Ventures has also invested in some of the same companies as Kleiner Perkins, which include; AltaRock Energy Inc., $25 million grant from the stimulus; Amyris Biotechnologies, $25 million grant from the stimulus; and Mascoma Corporation has received state and federal grants from the DOE since 2006, totaling over $170 million and as recent as 2008, received another $49.5 million in funding from the DOE and the state of Michigan. According to Scwheizer's Throw Them All Out, "Kholsa had been the head of Obama's India Policy Team during the 2008 election and contributed to Democratic candidates. 

• October 8, 2012: Bankrupt green loan loser Abound Solar now under investigation in Colorado –– Michelle Malkin  
• October 11, 2012: House Committee Launches Document Probe Into DOE, Abound Solar –– The Heritage Foundation October 25, 2012: Colorado officials continue Abound Solar fraud investigation –– The Daily Caller  
• October 27, 2012: EMAILS SHOW WHITE HOUSE DROVE FAILED GREEN-LOAN IN COLORADO –– The Complete Colorado by Todd Shepherd  
• October 29, 2012: Emails Show White House Exerted Pressure for DOE Loan to Abound Solar –– National Legal and Policy Center

Abound Connections: 
Those that gained financially and politically:

• 2008 billionaire heiress Pat Stryker, early investor in Abound (then AVA); 2008 Obama bundler and Democrat donor (and Obama donor for 2012)
• Democratic Congressman Paul Kanjorski’s nephew Russell
• Then-Colorado Democratic Congresswoman Betsy Markey (tied to cap-and-trade) 
• At the state level, then Democratic Colorado Governor Bill Ritter strongly supported Abound Solar and its application for a DOE loan guarantee, gave letter to Secretary Chu.
• Republican ties: Abound Solar is also backed by Invus Public Equities Advisors LLC, which was co-founded by Raymond Debbane, who has donated to Republican candidates including Representative Darrell Issa. Also, Abound, formerly known as AVA Solar won part of a $60 million grant under the Bush administration.

Shepherds Flat* (I covered in my July 2012 piece entitled, General Electric Making “Bank” off Obama's “Green” Stimulus Money; Over $3 Billion and Counting) 

EXCERPT: 

General Electric, CEO Jeffrey Immelt, Chair of Obama’s Job Council and the Billions They Raked in Through the 2009 Obama Stimulus Package 

Whereas General Electric (GE) is a heavy donor to both Republicans and Democrats, and Immelt himself "plays the role of typical corporate donor who hedges his bets on both sides of the fence," in 2008, GE gave the Obama campaign $529,855, marking them a top Obama donor. Nevertheless, GE is a major player on the clean-energy scene as well as in this green energy scheme. Even The New York Times recognized GE’s “green power,” noting that in 2009, GE lobbied Congress to help expand the “clean-energy subsidy programs, and it now profits from every aspect of the boom in renewable-power plant construction,” including “hundreds of millions in contracts to sell its turbines to wind plants built with public subsidies.” In fact, you'll be "blown away" by the billions of "wind energy grants" that blew out of the stimulus package back in February 2010, of which GE is contracted to at least 26% of them as the "Turbine Manufacturer."

In late 2009, it was reported that GE became "one of the newer smart meter players," and that they "had been working with utility Oklahoma Gas & Electric on a 6,600 smart meter trial, and had procured "a contract with Pepco Holdings (PHI)," which received Smart Grid Investment Grants totaling $168 million. GE also has a big contract with Florida Power and Light," also the recipient of a $200 million stimulus grant.

Yet, this is just the beginning of the GE "green bucks"...

While a recent "news flash" was published by the Republican National Committee, confirming via Recovery.gov that "General Electric received over $1.2 billion worth of stimulus loan guarantees, awards, contracts and grants" (the majority of which were for renewable energy projects), they missed billions more. Two large 1705 loan guarantees that I had outlined in April of this year, as well as a forthcoming $490 million cash grant and a $54.6 million loan from the Federal Railroad Administration (FRA). Add in some smaller government subsidies and awards for a multitude of green projects, programs, and through some of their "green alliances," that I found during my 2011 research, and GE's "green tab" exceeds $3 billion in direct (some indirectly) taxpayer cash, and counting. ;

Let's take a look at GE's two projects from the 1705 Loan Guarantee Program, both of which are included the DOE's risky investment portfolio.

• 1366 Technologies Inc, Rating B by Fitch, Sept 2011 –– $150 million
• Caithness Shepherds Flat, LLC –– Rating BBB- by Fitch; Oct 2010 for $1.04 billion (or $1.3 billion)

GE sponsored the Caithness Shepherds Flat, and also supplied the project with 338 wind-turbines. On top of the $1.3 billion loan, the Caithness project is set to receive a cash grant of $490 million from the Treasury Department once those turbines start turning.

Later, another close associate of, and big donor to the president invested in Caithness. As uncovered by Peter Schweizer in his book, Throw Them All Out, "Google's CEO at the time, Eric Schmidt, served as an informal advisor to President Obama.” Still, Schmidt, Google Executive Chairman, was an Obama donor in 2008, and since April 2009, is a member of the president's Science and Technology Advisory Council (PCAST). Interestingly, Google’s $814,540 contribution to Obama’s campaign made it the fifth largest donor in 2008. As of late, Google has aimed its "search engines" at green technology, many of which have received government "help" –– BrightSource, Solar City, Telsa Motors, and others, but we’ll stay focused on GE.

The House Oversight, March 2012 investigation reveals internal memos of concern over the fact that the Caithness Shepherds Flat project was receiving “an excessive amount of public subsidy (where grants, tax credits and loan guarantees provided 65% of the funding for the project), and that private parties did not have sufficient ‘skin in the game.’”

Further, it goes on to state, “Four months after the DOE approved the Caithness loan, President Obama named Jeff Immelt, the CEO of GE, as the Chairman of Obama’s Job Council” –– a council stacked with Democratic donors, and several Obama bundlers, both for the 2008 and 2012 campaigns.

It also discloses “General Electric’s broad access to loan guarantees,” and it gives a very illuminating account. “Since Immelt’s appointment as Chair of the Job Council, two additional government-backed transactions have occurred." "First the poorly rated 1366 Technologies, sponsored in part by GE, received a direct $150 million loan commitment from the DOE for its solar manufacturing plant." Second was the Federal Railroad Administration (FRA) that loaned $54.6 million to Kansas City Southern Railway Company (KCSR) "to purchase thirty new General Electric ES44AC diesel-electric locomotives" –– a loan that raised red flags in the House investigation. 

More to come...

However, another incriminating factor that struck me in the new report (memo) released by House Oversight is that "DOE officials were aware of Senate Majority Leader Harry Reid’s tough reelection in 2010 and moved projects that were important to Senator Reid forward." 

• In a December 5 2009 email, Loan Program Office Senior Credit Advisor Jim McCrea forwarded an article about Senator Reid’s reelection campaign to LPO contractor Paul Barbian and stated: “Since this is not going to go into the DOE, and just to be clear, the translation is: Reid may be desperate. WH may want to help. Short term considerations may be more important than longer term considerations and what’s a billion anyhow?” 
•  In a May 4 2010 email, LPO Executive Director Jonathan Silver wrote in an email “I need some stats on how many projects we have funded or have in DD [due diligence] as a percentage of totals.  Reid is constantly hit at home for not bringing in the federal dollars.”
• Throughout 2010 LPO emails indicate that projects in Nevada were prioritized because they were “high profile,” “tied to larger events,” or because they had Senator Reid’s support.  These projects included the $343 million SWIP project (Email #10, attached), the $98.5 million Nevada Geothermal project (Email #11, attached), and the $737 million SolarReserve Tonopah project. 

This is another part of the Green Corruption scandal brought to you by Marita and I in July 2012, Senator Harry Reid’s Part in Green-Energy Crony-Corruption. However, speaking of Jonathon Silver and Secretary Chu, they are both implicated in these newly released and damning email dumps –– both on my Green Corruption radar since 2010, along with at least a "Dozen DOE Insiders."

And in April 2012, Chu in my Green Corruption: Department of Energy “Junk Loans” and Cronyism, noting that in a gripping line of questioning, Ohio Representative Jim Jordan confronted this issue head on during that same hearing where he pressed Secretary Chu on nine of the firms that received loans, revealing their political connections. Chu countered that the loans were based on merit. Yet Jordan was perplexed, “so if you weren’t helping your buddies, and you were basing your decisions on the merits of the loan, how do you explain the fact that 23 of 27 recipients of the loan guarantees were rated as junk status investments?” Jordan concluded, “If it wasn’t your political buddies, it had to be incompetence.”

At first glance, we have plenty more cronyism and corruption to piece together with these "smoking gun" emails (and we will), and 100's of more emails to read. Still, it would be a worthy endeavor to investigate if Silver or Chu perjured themselves (or any other CEO as well as any former or current DOE Official for that matter), during any of the (five) House Oversight Committee hearings that have been conducted since 2011 –– my hunch, yes!

Stay tuned...

               You’ve heard of “Honest Abe” and “Gorgeous George” – let’s introduce you to “Sly Steven” Chu, American Energy Secretary.  And while we’re at it, move over Solyndra, Chevy Volt and Ener1, Inc., according to documents uncovered by the House Oversight Committee it appears Arizona-based Obama-supporting business leaders of First Solar, Incorporated received at least $3.1 billion of its total of $4.5 billion in loan guarantees based largely upon “adjustments” made to First Solar’s loan application by Energy Secretary Steven Chu’s personnel suggesting falsification of documents and/or corner-cutting by the Energy Dept. itself was required to get the loans approved.  According to an ABC News story, House Oversight and Government Reform Committee Chairman Darrell Issa (a Republican from California) accused the Department of Energy of “manipulating analysis, ignoring objections from career professional scientists and business people and strategically modifying” loan evaluations in order to “force project funding out the door.”   The Energy Dept. vehemently denied the charges, “The Department backed loans for two innovative solar projects that will support hundreds of jobs and provide clean power to tens of thousands of homes,” according to spokesman Damien LaVera.

          The roughly 3,250 permanent green energy jobs created in three-plus years across the whole nation by the Obama administration’s green-tech emphasis has thus far cost taxpayers $38 billion or more than $1.15 million for each permanent job, 90% of which pay less than $15/hr.

          Energy officials insisted to ABC News that the department followed a rigorous process to evaluate each applicant, and the two projects being scrutinized by Issa's committee are some of the most exciting solar ventures underway in the United States. If successful, the massive generating facilities would be by far the largest of their kind in the world -- comprised of more than five million solar panels and 35,000 metric tons of steel.  Note the confusion between newness and excitement and solid business decision-making.  Meanwhile Issa and his committee say they sifted through tens of thousands of pages of internal records turned over by the Energy Department in response to their requests.  The granting of multiple loans to First Solar, a solar energy giant based in Arizona to create Agua Caliente in Arizona and the Antelope Valley Solar Ranch in California and then turn these facilities over to utility companies is unusual (First Solar also received a separate $1.5 billion loan).  The standard for the loans was not “viability” and not “potential profit” but rather merely providing evidence that the projects “would employ new and innovative technologies to generate energy.”  It appears that Energy Dept. officials “adjusted” First Solar loan documentation to fulfill this requirement.  It appears that First Solar did not qualify even upon this narrow requirement.  Among the documents the Oversight Committee cites is an email from a top technical expert inside the department, written well before the loans to First Solar were approved, in which the scientist argues one of the supposed advances -- use of a "single axis tracker" -- was actually not new at all.

          "Be clear this is not an innovation," wrote Dong K. Kim, the director of the loan program's technical division. "The record will show we did not grade this as an innovation."  Kim also wrote that "someone keeps changing" internal documents to hold out the tracking technology as innovative. And he warns that "whoever continues to make this change needs to understand that Technical does not support” emphasis of the trackers as an actual innovative component the Energy Department itself has identified their use in over 200 units in Europe, according to the internal documents.

          "These facts make clear DOE substantively failed to fund innovation, and instead gambled with $3 billion taxpayer dollars on a single firm, First Solar," said Becca Watkins, an oversight committee spokeswoman.  Meanwhile despite the positive spin put upon matters by company officials, First Solar is not proving profitable and only the huge government loans so far have kept the company afloat.  .

          First Solar, Inc. officials say they are forecasting more than $3 billion in revenue this year (revenue, NOT profits, you’ll notice) but acknowledged the company has suffered along with the rest of the solar industry. The company's stock has been sliding, and has become a favorite for so-called stock market "short sellers" -- investors who are betting on the company to fail.  While this Solyndra story might serve as a case-study in venture-socialism, this January’s failure of once highly respected Ener1, Inc., a huge maker of automobile batteries intended for green vehicles, provides a much more significant cautionary note.  Ener1’s financial collapse appears to have occurred NOT because their product is lacking in technological merit, but rather because there is no market for the recipient’s of Ener1’s batteries:  ultra-expensive, low-performance green autos. 

*          *          *

           In related news and relevant background:  Energy Sec. Chu, of course, who has come under attack for a long and repeated history of advocating letting American gasoline prices rise to European levels, last week on Capitol Hill, Chu said he “no longer” believes that way; President Obama, for his part has embarked upon a nationwide “gas-price-apology tour” aimed at denying any and all responsibility for gasoline price rises of $2/gallon (national average $1.83 in January, 2009; $3.85 today) and rising since he took office.  And even though the mainstream media won’t hold you accountable for it, you and Interior Secretary Ken Salazar were informed three weeks prior to the BP Gulf spill that big problems were in the works at the Deepwater Horizon site and were still ready to present BP with a national safety award . . . and then POUNCE!  Your opportunity came with the BP oil spill and you shut down drilling EVERYWHERE and put into effect a shameless foot-dragging policy of grudging approvals where you had no choice. 

           When I was a college student, one of the psychological principles I learned about was called “word magic.”   No, I’m not referring to the two magic words “Please” and “Thanks,” but rather to the childish use of words and labels (positive and negative) to seek to affect and change the world to our liking rather than dealing with it (the world) in a more adult fashion.  Mr. Obama used word magic in an interview with the San Francisco Chronicle in 2008 which was never run (it’s still on the paper’s website and now found all over the internet, however) by the Chronicle or any other mainstream media (MSM) in which he pledged to “bankrupt the coal industry” and bragged that “under my environmental policies and cap and trade, electricity prices will necessarily skyrocket.”  Mr. Obama seems to believe that merely by saying “green energy” his words will create a viable reality.  Sorry, Mr. President but algae won’t make my car run presumably anytime in the next couple centuries.  The two top green energies are hydro-electric power and wood-burning just as they were back in 1940.  Wood-burning, of course, is renewable and not particularly clean . . . nevertheless, wood-burning provides 2.5% of America’s energy which is more than solar, wind, geothermal, and cold fusion combined.  Face the facts; you’re saying that oil is the “energy of the past” doesn’t make it true.  And your equating drilling to create lower gasoline prices with “snake oil” is a monstrous lie.  The only ones selling snake oil to the public is you, Barack Obama, and your progressive sycophants.

Ya’all live long, strong and ornery,

Rajjpuut