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Feds pour $32 million more into beleaguered solar industry

By   /   June 2, 2015  /   No Comments

Part 10 of 11 in the series SolarCity

By Tori Richards | Watchdog.org

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GREEN COMPANIES GET BOOST: Another $32 million will go into the solar energy hole.

The Department of Energy has doled out another $32 million to support the solar industry, a sector fraught with technology challenges and scandal – and nevertheless propped up with billions of taxpayer dollars during the Obama Administration.

This latest funding is dedicated to training a workforce of solar technicians, developing new technology and implementing a database to share performance data, the DOE announced in a press release last week.  The training goal is 75,000 workers by 2020 and an undisclosed amount of “other professionals” in other fields such as real estate, finance, insurance and fire and safety.

What the release didn’t say was that the Obama Administration has spent $150 billion on green initiatives between 2009 and 2014, yet the industry cannot survive without government giveaways, a Brookings Institution study found.

Courtesy of Brookings Institution report

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“Taxpayers shouldn’t be forced to spend even more money on job-training programs that are proven failures,” said Heritage Foundation energy expert David W. Kreutzer. “Industry will provide job-training where there are real jobs to be filled. The energy revolution in places like North Dakota and Texas has created hundreds of thousands of jobs—many of which required considerable technical skill—without a federally funded job-training program.”

Green giveaways were ramped up in 2009 with the passage of the American Recovery and Reinvestment Act (ARRRA), which dedicated $51 billion to renewable energy. A portion of ARRA was used for solar company loan guarantees, like the bankrupt Solyndra ($535 million) and Abound Solar ($400 million).

Then there was Ivanpah, a solar electricity plant that received more than $2 billion. When that project was completed, it produced less than 40 percent of projected output at a cost three times higher than traditional electricity, according to a report by the Taxpayer Protection Alliance.

A 30 percent tax credit for home and business owners who install solar systems has been in place since 2005. Experts say the residential solar industry will face a real test of its sustainability when the credit drops to 10 percent for businesses and disappears for homeowners starting in 2017.

The tax credits, incentives and loan guarantees have spawned a whole new type of business – solar leasing, pioneered by California-based SolarCity. The option of reaping the benefits of a solar system while paying a small monthly leasing fee has been attractive to some consumers –  at a cost to other taxpayers. Behind the scenes, the U.S. Treasury Department began to investigate whether SolarCity, Sunrun and Sungevity inflated the costs of their installations in order to receive additional tax incentives.

SolarCity also finds itself under investigation by the FBI for allegations it misused taxpayer funds. In that case, The Oregonian reported that after it blew a federal deadline SolarCity officials backdated an application for a $12 million government grant.

And if that isn’t bad enough news for the solar industry, Arizona state legislators passed a law requiring greater transparency in solar contracts. Solar lobbyists vehemently opposed the legislation, which calls for such disclosures as tax liabilities, total system costs and depreciation schedule.

The push toward renewable energy is spurred by Obama mandates that federal government buildings use 20 percent renewable energy by 2020. Twenty-nine states have followed suit, requiring utilities to produce a certain amount of renewable energy.

“If solar is as competitive as its supporters say, then great! We can get rid of renewable mandates, net-metering, the 30 percent investment tax credit, etc.; and let solar run everybody else out of business,” Kreutzer said.


Part of 11 in the series SolarCity


Tori formerly served as staff reporter for Watchdog.org.