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Obama’s Energy Priorities

- February 29, 2012

While The Obama Administration Isn’t Focused On Lowering Gas Prices, His Pet Energy Projects Are Facing Troubles

THE OBAMA ADMINISTRATION ISN’T FOCUSED ON LOWERING GAS PRICES

Yesterday, Energy Secretary Steven Chu Said The Energy Department Isn’t Focused On Gas Prices.  “The Energy Department isn’t working to lower gasoline prices directly, Secretary Steven Chu said Tuesday after a Republican lawmaker scolded him for his now-infamous 2008 comment that gas prices in the U.S. should be as high as in Europe. Instead, DOE is working to promote alternatives such as biofuels and electric vehicles, Chu told House appropriators during a hearing on DOE’s budget. But Americans need relief now, Rep. Alan Nunnelee (R-Miss.) said — not high gasoline prices that could eventually push them to alternatives. … ‘But is the overall goal to get our price’ of gasoline down, asked Nunnelee. ‘No, the overall goal is to decrease our dependency on oil, to build and strengthen our economy,’ Chu replied. ‘We think that if you consider all these energy policies, including energy efficiency, we think that we can go a long way to becoming less dependent on oil and [diversifying] our supply and we’ll help the American economy and the American consumers.’” (Alex Guillen, “Chu: DOE Aims To Wean U.S. Off Oil,” Politico, 2/28/12)

IN THE NEWS TODAY, WE SEE WHAT THE ADMINISTRATION IS REALLY FOCUSED ON

Another Obama Green Energy Project Cuts Its Work Force

Yesterday, Abound Solar Laid Off 280 People, 70 Percent Of Its Work Force. “Abound Solar on Tuesday cut 280 jobs -- 70 percent of the workers -- at the company's production facility along the Interstate 25 Frontage Road near Firestone. The company notified the workers, which had been running three shifts around the clock, on Tuesday, according to chief financial officer Steve Abely. The cuts affected 180 full-time workers and 100 temporary workers Abound had hired. Abound, which manufactures thin-film photovoltaic solar modules, made the cuts because it is abandoning work on its first-generation module and switching to a next-generation module that will be much more efficient, Abely said, adding that company officials hope most of the cuts are only temporary” (Tony Kindelspire, “Abound Solar Cuts 280 Jobs At Longmont Facility,” Longmont Times-Call, 2/28/12)

Abound Solar Received A $400 Million Loan Guarantee From The Department Of Energy In July 2010. “Tuesday's announcement has no effect on the $400 million loan guarantee that the U.S. Department of Energy announced for Abound in July 2010, Abely said. So far Abound has taken about $70 million of that out in loans, and is in communication with the DOE at least weekly, he said. ‘They understand what's going on,’ Abely said. ‘They're very supportive of the company and its technology.’ He said the DOE loan is directly tied to Abound continuing to manufacture its products in the U.S., and by extension indirectly tied to its creating jobs, both of which it hopes to be doing again before the end of the year, Abely said.” (Tony Kindelspire, “Abound Solar Cuts 280 Jobs At Longmont Facility,” Longmont Times-Call, 2/28/12)

  • Abound Solar Is Backed By A Billionaire Obama Bundler And Donor. “Abound Solar, given a $400 million Department of Energy (DOE) loan guarantee for a project expected to create 400 permanent jobs, receives private financial backing through an investment firm founded by a fundraising bundler for President Obama. The Sunlight Foundation notes that Bohemian Companies, which was founded by billionaire and Obama bundler Pat Stryker, participated with other companies in the ‘second institutional equity round of financing’ in 2008 for Abound Solar, which recieved $104 million total through that round of financing. Stryker gave $50,000 to Obama's inauguration, according to the Center for Responsive Politics, and raised a further $87,000 for the inauguration. Stryker has since donated $35,800 to the 2012 Obama Victory Fund, Sunlight reports.” (Joel Gehrke, “Another Obama Bundler Benefits From DOE Loan,” The Washington Examiner’s Beltway Confidential, 12/1/11)

Troubled Fisker Automotive Replaced Its CEO

Yesterday, Fisker Automotive, Which Received A $529 Million Energy Department Loan Guarantee, Replaced Its CEO With Auto Industry Veteran Tom Lasorda. “Electric car startup Fisker Automotive announced Tuesday that company founder and CEO Henrik Fisker is being replaced by Tom LaSorda, a veteran of Chrysler and General Motors. Fisker, based in Anaheim, makes the $102,000 plug-in hybrid Karma and hopes to manufacture a second vehicle, a sedan known as the Nina, at a former GM plant in Wilmington, Del. The executive shake-up comes as Fisker faces several formidable challenges and growing competition as other all-electric and plug-in hybrid vehicles enter the market. In recent months, Fisker has been beset by production delays, a voluntary recall of battery packs, software glitches, trouble getting the Delaware plant up and running and a freeze on the bulk of its $529 million Energy Department loan guarantee.” (Dana Hull, “Fisker Automotive Replaces CEO With Auto Industry Veteran,” Contra Costa Times, 2/28/12)

Fisker Is Facing Financial Issues Which Have Delayed It From Receiving The Largest Portion Of Its Loan. “One of the biggest issues facing the company is money. Fisker has raised more than $860 million in private equity financing since 2007, but more is needed. Fisker was awarded a $529 million loan guarantee from the Energy Department, including $169 million for the Karma. But the largest portion of the loan, $359 million, was to support production of the Nina and bring the shuttered GM plant back to life. Earlier this month, Fisker disclosed that it had drawn down only about $190 million, or one-third, of its loan due to delays meeting sales and production targets. All Energy Department loan guarantees have strict guidelines in place to protect taxpayers, and companies are only able to draw down funds as they meet certain milestones. The delays have created additional costs, and Fisker is now revising its business plan in an attempt to free up the rest of the money.” (Dana Hull, “Fisker Automotive Replaces CEO With Auto Industry Veteran,” Contra Costa Times, 2/28/12)


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