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NEW YORK (

TheStreet

) --

Solyndra

, the failed U.S. solar company backed by the Department of Energy loan guarantee program, and a hallmark of the Obama administration's green energy job creation program, is the focus of a House Energy and Commerce committee grilling on Wednesday.

The head of the Office of Management and Budget Jeffrey Zients -- responsible for evaluating and quantifying the risk of each DOE project -- and the DOE loan guarantee program top official, Jonathan Silver, are testifying before the committee in what could serve as an inflection point for the Obama administration green energy policy.

While the recent bankruptcy of Solyndra has put the solar company in the headlines, an accurate rendering of the facts shows that the House committee has been hounding Solyndra since at least this past March, when it first requested the OMB turn over all documents related to the failed U.S. solar company. At that time, Solyndra hadn't failed, but the House committee noted in all of its attempts to secure documents related to Solyndra that it had experienced financial difficulties. The bankruptcy, therefore, should have taken no one by surprise, and that includes the OMB and DOE.

In fact, one important wrinkle in the Solyndra debacle which should get aired on Wednesday is just when these officials knew the company was going belly up. Recent raids by the FBI on Solyndra's offices -- which reports suggest were triggered by a request from the DOE's investigative counsel -- are no more than a sign of the DOE trying to shift the blame for its own poor oversight, critics of Solyndra and the DOE say. They argue the idea that Solyndra officials pulled the wool over the eyes of the government and presented a "rosy" scenario for its financial health just don't stand the test of logic.

They may have a point: Recent filings suggest that the DOE put itself into a subordinated position versus equity holders in the venture capital world when it loaned money to Solyndra, a move that venture capitalists say shows just how desperate the government was to try anything to keep the solar company afloat -- i.e. it would have been no surprise to the DOE that the company was on the verge of implosion given its capitulation to a less secure creditor position.

In written testimony provided to the committee ahead of the hearing, OMB's Zients indicated the company faced "imminent default" at the time of the decision to restructure debt. Both Zients and Silver have taken the stance in their testimony that there was no choice: if they did not restructure the loan Solyndra would have gone bankrupt, and restructuring at least provided some hope of recovering more taxpayer money.

Henry Waxman (D-Calif.), on the other hand, maintains that Solyndra officials told him in July everything was A-OK and that it would double its revenue in 2011.

The history between the DOE, OMB and the House committee is not a friendly one, and now that the solar company has failed one can expect its critics on the House committee will tee off on the people in charge of approving the loan. While some Democratic members of the energy committee, including Waxman, have maintained all along that it's just partisan politics -- some members of the committee are focused on the ties between President Obama and fundraisers of his campaign who are equity holders of Solyndra -- the company's bankruptcy and the potential loss of $527 million in taxpayer money makes it a lot more difficult for Dems to toss it off as the work of partisan hacks.

Indeed, on Wednesday morning, Waxman allowed that it was time to review the Solyndra investment and discover what went wrong, and whether sloppy federal government oversight, and not just potential corporate malfeasance, were embedded in the bankruptcy -- though Waxman made sure to stress that the Bush administration had supported Solyndra before the Obama term.

Here are a few quick facts about how we got to Wednesday's Solyndra-gate hearing, facts that came well before the company's bankruptcy announcement:

In March, the House committee requested all documents from OMB relating to the Solyndra loan guarantee.

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Three months then passed without the OMB complying.

In June, the committee requested that OMB's Zients testify. He was a no-show.

In July -- again, well before the bankruptcy -- the committee issued a subpoena for all government documents related to Solyndra, a move which House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) said, "is not a step this committee takes lightly."

Granted, Upton also supported the Tea Party in its recent attack on LED light bulb mandates from the federal government, flip-flopping from his original support of the energy efficiency move. He joined the Tea Party chorus that tagged LED light bulbs as the sign of an authoritarian regime, one of the more ludicrous moments in the recent bold Tea Party muscle-show on Capitol Hill.

Rep. Cliff Stearns (R-Fla.), who has led the attack on Solyndra, has said the committee is reviewing all the loan guarantees made by the DOE. While Solyndra should be viewed as a unique failure, the biggest U.S. solar companies,

First Solar

(FSLR) - Get First Solar, Inc. Report

and

SunPower

(SPWRA)

have both secured loans from the DOE. Three of four First Solar loans are in the conditional commitment stage, as is the SunPower loan, which places them in an unprecedened form of political limbo.

Partisan politics are undeniably caught up in the mix, too. Nevertheless, as the chairman of the House committee, Upton noted on several occasions through his committee's battle versus the OMB and DOE, and noted with some of his own alarm, the committee has never had oversight of the DOE program which has lent more than $11 billion to green energy projects. The oversight day has come.

The fact that Solyndra and its federal minders have been in hot water with the government from well before the bankruptcy, magnifies the issues now, and the issues -- aside from partisan politics -- are significant. If the House committee doesn't descend into the usual dog and pony show, this could be a referendum on the DOE loan guarantee program concept, how it should be run, and more alarmingly for its fans, if it should exist.

-- Written by Eric Rosenbaum from New York

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