More than a decade since President Barack Obama took office and began handing out billions of taxpayer dollars to green energy companies, some of those companies are still filing for bankruptcy.
Most people will recognize the name Solyndra, which stands as the biggest example of Obama’s green-energy failure. The company received more than half-a-billion dollars from taxpayers through the Obama administration’s massive stimulus bill in 2009 and filed for bankruptcy in 2011. Obama touted the company as an example of his stimulus’ success – a green energy company that was helping the environment and creating construction jobs. The company’s bankruptcy became its own example of Obama’s stimulus – taxpayer dollars going to pie-in-the-sky companies with the right political philosophy.
On Friday, The Wall Street Journal’s editorial board wrote about another failure from the Obama era, this one costing taxpayers as much as $510 million. The company, Tonopah Solar Energy, operated the Crescent Dunes solar plant in Nevada, which received $737 million in guaranteed loans during the Obama administration. Tonopah was granted a Chapter 11 bankruptcy plan in early December.
“The plan includes a settlement with the Department of Energy that leaves taxpayers liable for as much as $234.68 million in outstanding debt, but the total public cost is even higher. Crescent Dunes also received an investment-tax credit, and the 2009 stimulus legislation allowed it to receive a cash payment in lieu of credit. In 2017 the plant received more than $275.6 million from Treasury under the Section 1603 program, which it used to service its outstanding liabilities. So taxpayers already gave Crescent Dunes cash to pay off its taxpayer-backed loans,” the Journal reported.
As the Journal reported, Crescent Dunes said it could use molten salt to retain heat from the sun to produce steam and generate power 24 hours a day, instead of just when the sun was shining. Those kinds of promises failed to get it financing from commercial lenders, but the Obama administration stepped in and provided the money.
To show just how much government agencies continue from one administration to the other, the Department of Energy kept propping up Crescent Dunes into the Trump administration. As the Journal pointed out, the solar plant suffered from construction delays, equipment failures, and frequent outages. It was expected “to produce up to 482,000 megawatt hours every year, but the plant hasn’t produced that much energy in its lifetime.”
“The Crescent Dunes failure shows again what happens when government invests in commercial ventures beyond its expertise for political purposes. Scarce resources are misallocated and taxpayers lose. We wish we could say the politicians have learned from failure, but the Biden Administration is coming to town promising much more of the same,” the Journal concluded.
The only way taxpayers could recover up to $100 million is if Crescent Dunes can start operating again and meet its energy production and revenue milestones, which can’t possibly happen since the plant’s only purchaser, Nevada Energy, terminated its agreement with the plant. And don’t expect another buyer to come along, since the power created by Crescent Dunes is more expensive than other renewable-energy plants in the state.
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