DOE Official Calls Energy Loan Program an ‘Enormous Success’

Locutus

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Seriously. :lol:


During a hearing on the Department of Energy’s (DOE) loan guarantee program for “green” energy projects on Thursday, DOE Loan Program Office Acting Executive Director David Frantz had some surprising news: contrary to report, after report, after report, the program has actually been an “enormous success.”

“Don’t you agree that the loan guarantee program has had a tough record?” Rep. “Cliff” Stearns (R-FL) asked Frantz.

“Ah, quite to the contrary, sir,” Frantz responded, “I think it has been an enormous success.”

“Okay,” Rep. Stearns continued, “we have Solyndra, we have Beacon, the third recipient went bankrupt in 2011. That’s true, isn’t it?”

“It is.”

“Okay, the fifth DOE loan went bankrupt just a few weeks ago. Isn’t that true?”

“We, we have — ”

“I’m asking the questions, please. Isn’t that true?” Rep. Stearns asked again. “The second recipient, a loan guarantee First Wind has withdrawn its IPO [Initial Public Offering] and has significant debt.”

“The fourth recipient, Nevada Geothermal, was also the recipient of a ‘going concern’ letter from its auditor. Three of the first five are bankrupt and the other two seem to have significant problems,” the congressman added.

At this writing, it‘s unclear what Frantz’s definition of “success” is.


DOE Official thinks loan program that gave us Solyndra is "enormous success" - YouTube


No Joke: DOE Official Calls Energy Loan Program an ‘Enormous Success’ | Video | TheBlaze.com
 

Tonington

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I'll give you a hint. Look up the default rate for the program. It's lower than the default rate of many large private banks and lower than the date for student loans. And, the default rate is still lower than the DOE budgeted for. Considering these were higher risk, that is success.
 

Tonington

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It was a success in that they managed to give away all the money in their budget.

It was a success in that they had fewer defaults than they planned for. If you're a project manager with $2 billion worth of high risk projects, and you plan on 15% of that failing, and only 5% fails, then that was a successfully executed plan.

In the case of Solyndra, the risk was prices of conventional solar pV components. Solyndra made a very different product, and had the price of other pV not come down so drastically due to plummeting silicon prices, they would have been fine. But that's the risk with new technology, and what made many of these projects so high risk.

In the end, the defaults are less than they planned for, so that is a success.
 

mentalfloss

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I'll give you a hint. Look up the default rate for the program. It's lower than the default rate of many large private banks and lower than the date for student loans. And, the default rate is still lower than the DOE budgeted for. Considering these were higher risk, that is success.

/thread.
 

taxslave

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It was a success in that they had fewer defaults than they planned for. If you're a project manager with $2 billion worth of high risk projects, and you plan on 15% of that failing, and only 5% fails, then that was a successfully executed plan.

In the case of Solyndra, the risk was prices of conventional solar pV components. Solyndra made a very different product, and had the price of other pV not come down so drastically due to plummeting silicon prices, they would have been fine. But that's the risk with new technology, and what made many of these projects so high risk.

In the end, the defaults are less than they planned for, so that is a success.

If they planed on 15% failure rate they were just shoveling money off the back of the truck with little concern of the outcome. You plan for 100% success and accept that some won't make it.
When the dippers were busy destroying BC in the 90s then premier Glenn Clark even bragged about doing just that. Rather irresponsible with taxpayers money.
 

Tonington

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If they planed on 15% failure rate they were just shoveling money off the back of the truck with little concern of the outcome. You plan for 100% success and accept that some won't make it.

A plan for 100% success is a plan for failure, but really you're just restating what I already said by adding that a certain failure rate will be acceptable. Do you think my company plans on each and every drug candidate and vaccine product making it all the way from Discovery through to market approval? Nope, that is simply unrealistic, and you will fail to hit your financial targets. And that's what we're measured by. There is always a risk that something you can't foresee will come up and cause you to miss targets, or even to kill projects.

Banks who lend money don't even plan on a 0% default rate, because that is just plain unrealistic. A good plan is one that takes into account the risk, and allows for an acceptable amount of failure, without sandbagging on the targets. But you wouldn't plan on 100%.
 

taxslave

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A plan for 100% success is a plan for failure, but really you're just restating what I already said by adding that a certain failure rate will be acceptable. Do you think my company plans on each and every drug candidate and vaccine product making it all the way from Discovery through to market approval? Nope, that is simply unrealistic, and you will fail to hit your financial targets. And that's what we're measured by. There is always a risk that something you can't foresee will come up and cause you to miss targets, or even to kill projects.

Banks who lend money don't even plan on a 0% default rate, because that is just plain unrealistic. A good plan is one that takes into account the risk, and allows for an acceptable amount of failure, without sandbagging on the targets. But you wouldn't plan on 100%.

You do if you are a contractor. I don't know of a single one that knowingly bids a job to loose money. That would be a surefire way to hit bankruptcy court. But then we play with our own money, not taxpayers.
 

Tonington

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You do if you are a contractor. I don't know of a single one that knowingly bids a job to loose money.

What kind of contractor? Building a road? Cutting a right of way for the power company? We use contract research organizations, they don't always deliver the results we want. again, it comes down to risk. The type of contracting you are talking about may be far less risky of a project than a new business with a new product in a competitive market.

And I do know of cases where contractors will bid to lose money. If your business can handle the loss, you can put other businesses out of business by taking away the contracts by under-bidding. Happened alot with the tree trimming company I worked for when I was in high school. Bigger companies like Lucas Tree, or Asplundh could take a loss on a small contract.

But a building contractor is a great deal different than loaning money for capital projects.
 

Highball

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Why not? It is modeled aftre Fannie Mae, Freddie Mac, The FED and other organizations that loose billions and their Administrators all get big bonuses for their "Success!" Maybe that Italian sea Captain of the capsized Tour Liner should qualify for the Presidential Medal of Freedom too? He did get close enough to shore to let some swim to safety after he abandoned his vessel. Same thing? Right? Or Arnold Paulson, the US Secretary of the Treasury for a skilled and successful engineered fiscal crisis after he retired from Goldman Sachs? National hero status? Not in my book. Paulson, Chenry, Bush and others ran with our money. Why not give them all an award?
 

Locutus

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