Darrell Issa Slams Loan To Bankrupt Energy Company Backed By Democrats And Republicans

WASHINGTON -- Republicans have jumped on the latest failed solar company, lambasting it as another example of the Obama administration's "politically motivated" and "failed green energy agenda."

The company in question, Abound Solar, was also backed by the George W. Bush administration along with other prominent Republicans, including Indiana Gov. Mitch Daniels and Indiana Reps. Mike Pence and Dan Burton.

Abound, which received about $70 million in loans from the Department of Energy, declared bankruptcy Thursday, prompting a slew of comparisons to Solyndra, a similar company that failed in 2011 in spite of getting a $535 million loan guarantee.

U.S. Rep. Darrell Issa (R-Calif.), the House Oversight Committee chairman, led the charge condemning Abound Solar and Obama's energy policy in a statement Thursday.

"As part of its examination of President Obama’s failed green energy agenda and botched loan program, the Oversight Committee spotlighted in January the very real risks to taxpayers from Abound’s weak balance sheet," Issa said. "Abound received a junk credit rating of B, below that of the failed Solyndra. Today, that risk has become a reality, demonstrating yet again that taxpayers pay the price when the Obama Administration makes politically-motivated decisions as part of its failed green energy agenda."

Issa didn't address the political motivations of Republicans who backed Abound Solar. Several of them have supported other green-energy projects before.

Burton and Pence, along with Sen. Dick Lugar (R-Ind.) and others, wrote a letter to Secretary of Energy Steven Chu in October 2009 to plead for a DOE loan for Abound Solar, saying that the Tipton, Ind. plant it was building could create nearly 1,000 jobs. They also praised the green-energy agenda, saying, "We are encouraged by the increased emphasis on energy efficiency and on renewable sources of energy for the nation."

Daniels also trumpeted the company as a job creator in 2010. During his administration, the Indiana Economic Development Corporation offered the company more than $12 million in performance-based tax credits and training grants. Lugar also praised the company for its work in the state.

Abound Solar's government support, however, did not start in the Obama administration. The company also received $3 million in funding from the Bush Administration in 2007, back when it was called AVA Solar.

The company is the third DOE-backed company to declare bankruptcy, following Solyndra and Beacon Power, an energy storage company, both of which filed for bankruptcy in 2011.

Aggressive pricing competition from China and a global oversupply of its solar panels forced Abound Solar to stop production in February. According to a statement from Damien LaVera, a DOE spokesman, taxpayers may lose $40 million to $60 million on the loan after Abound’s assets are sold and the bankruptcy proceedings close.

While Issa has alleged some sort of political motivation for the loan, investors in Abound have donated not just to Republicans, but to Issa himself.

Raymond Debbane, the chairman of Abound's largest equity investor, Invus, gave Issa $5,000 for this upcoming election, as well as another $5,000 for Issa's political action committee in the last election. Debbane, who donates to both parties, has given $30,000 to GOP candidates this cycle.

Issa spokesman Jeffrey Solsby said Issa inferred there was political motivation in supporting Abound Solar since it received the loan despite its weak balance sheet and poor bond rating.

"That the firm received the loan even after it was revealed it was highly risky and speculative gives the impression of a process driven more by politics than weighed on the merits," he wrote in an email.