At a time when the alternative energy industry is calling for the Department of Energy (DOE) to follow through on loan guarantees, the U.S. House of Representatives is attempting to pass a Senate bill that would cut the program’s budget by $1.5 billion. According the the Solar Energy Industries Association (SEIA), this move is part of a $26.1 billion package that is reallocating funds to cover other struggling areas including Medicaid and teacher salaries.
This program came to the public’s attention last year when it was used to fund the $2 billion Cash for Clunkers Program – a program that ran out of funds within days of being launched.
According to an article in Solar Industry News, SEIA is furious over the proposed cuts even though the program is already significantly over budget. The association estimates that to date, there are 81 renewable energy project applications that total an estimated $31 billion, yet there is only $25 billion left in funding, not calculating any additional program cuts.
Al Gore has entered the fray publishing a quote on his website about his outrage. “These rescissions put into jeopardy the green jobs that the administration has touted as part of our clean-energy future and put us further behind the rest of the world.”
The alternative energy industry has been struggling for the past several years due to both dwindling private investment funds, lack of cohesive policy that would ensure long-term markets, and the lack of loans from the financial sector. The loan guarantee program is one of the last sources of monies for companies to tap in to as they struggle to develop and bring to market new technologies.
In a letter to Speaker Nancy Pelosi dated August 6th and endorsed by the American Wind Power Association, Biomass Power Association, Geothermal Energy Association, and the National Hydropower Association, the groups wrote that the cuts significantly undermine the DOE Loan Guarantee Program.
“Failure to act on the Treasury Grant Program and other tax incentives or to restore funding to the DOE Loan Guarantee Program will jeopardize the renewable energy industries’ efforts to develop clean electric generation and create tens of thousands of jobs. We urge you to work with the Administration and the Senate to reverse these cuts and restore funding for the renewable energy loan guarantee program,” the letter concluded.