Cronyism Chronicles: Export-Import Bank’s Pet Solar Energy Project
When you read an article about the Export-Import Bank and all the jobs it’s helping to create by “investing” in green energy technologies around the world, hold your applause. One such article touts the $780,000, 10-year loan guarantee for the export of photovoltaic (PV) solar modules from a Georgia-based company, Suniva Inc., to a rooftop solar-power project in Mexico.
While some characterize Suniva as a “fast-growing solar startup often held up as an example of American innovation,” the Norcross, GA-based company is no stranger to the Washington game. According to Open Secrets, the company has spent $360,000 lobbying lawmakers.
In 2011, after expressing “displeasure” with Department of Energy’s “terms and conditions, Suniva abandoned efforts to secure a $141 million loan. Instead, the company received a hefty tax incentive from the Michigan Economic Growth Authority “to open a $250 million solar cell manufacturing facility in the Great Lakes Technology Solar Park.”
Not surprisingly, one of the cheerleaders for this new deal is the man who heads up the Ex-Im Bank, Fred P. Hochberg:
With this authorization, Ex-Im Bank is continuing its strong support for Suniva’s high-efficiency exports that are sustaining high-quality jobs in Georgia. Our financing also benefits GMI, which will reap clean-energy savings for years to come. We hope to support many more such projects in Mexico and around the world.
You don’t “sustain” jobs by using taxpayers to guarantee loans that – based on past experience and the current state of solar energy technology – are rather likely to fail. More importantly, though, if Suniva Inc. cannot compete in the free market by creating a good enough product, it becomes the American taxpayers’ undue duty to “sustain” said jobs.
Ultimately, what this is about is cronyism and the left’s green energy agenda. As Mr. Hochberg said, he and his friends hope to support more such projects in Mexico and around the world, with the backing of our taxpayer money, of course.
If that news doesn’t make you happy, maybe this will. The Ex-Im Bank’s loan guarantee is so generous, that it will also support approximately $130,000 of related local costs for the project’s installation and connection to the grid. Talk about lending a helping hand, eh?
Conservatives take no issue with innovation. Photovoltaic technology may one day be viable in the free market and consumers may demand it. But as the Heritage Foundation’s Nick Loris said:
Renewable sources may very well play a greater role in our energy portfolio, but that should be driven by markets and competition, not subsidies and mandates.
Similarly, they should not be propped up by taxpayer-backed loan guarantees. The folks at the Ex-Im Bank don’t understand that. They never have. Nor do the folks at companies like Suniva. They recognize that they have a “longstanding and valuable relationship” with the Ex-Im Bank. Yes, but valuable to whom? It may be valuable to Suniva, but it puts taxpayers in a precarious situation. If the company fails to repay the loan, it will be repaid by U.S. taxpayers.