Ryan budget plan calls two solar projects ‘ill-fated,’ but they’re doing fine


Rep. Paul Ryan’s budget plan mentions two solar projects as examples of “the latest ill-fated ventures” to have received federal loan guarantees. But both projects are alive and well. (MICHAELA REHLE/REUTERS)

Rep. Paul Ryan (R-Wis.) included a paragraph in his budget plan that mentions two solar projects as examples of “the latest ill-fated ventures” to have received federal loan guarantees.

But the two projects are alive and well.

The first is Solar Reserve’s solar tower in Nevada, which is under construction, on time and slightly under budget, with about 450 people on the job. More than a dozen business groups from around the world have come to take tours and view the technology.

The second is Sempra Energy’s Mesquite Solar complex, 40 miles west of Phoenix, where the first phase of construction was completed in December. In January, the complex started generating electricity, which will be sold to Pacific Gas & Electric under a 20-year contract.

“I have no idea what’s behind Congressman Ryan’s blurb in his budget,” Solar Reserve chief executive Kevin B. Smith said in an interview. “Clearly he got some bad information. I’m assuming it was an oversight on their part, but it’s a pretty big inaccuracy.”

Accounting for the surplus in Ryan’s budget plan

In a letter to Ryan, Smith called his project “a solid success story,” adding: “Hopefully, the comments in your updated budget proposal will not damage our opportunities for technology exports.”

Ryan’s spokesman, William Allison, said: “Some of these green-energy projects stay in business, some don’t. It is a risk that the federal government puts on the hardworking taxpayer. That is why our budget proposes to get out of the business of picking winners and losers.”

But Smith said his company has worked to minimize that risk and will not end up costing anything to taxpayers. He also said Solar Reserve is in the middle of developing export markets and has talked with companies or officials from China, Saudi Arabia, South Africa and elsewhere.

Ryan’s budget plan includes this sentence: “Many of the administration’s loan-guarantee projects have failed: Beyond Solyndra, the latest ill-fated ventures include a $737 million loan guarantee to Solar Reserve for a 110-megawatt solar tower on federal land in Nevada and a $337 million guarantee for Mesquite Solar 1 to develop a 150-megawatt solar plant in Arizona.”

Solyndra, the Silicon Valley-based photovoltaic-panel maker that went bankrupt after receiving half a billion dollars in federal loans and guarantees, has become a poster child for the failure of Energy Department loan guarantees that were part of the 2009 economic stimulus package.

But the other two plants are generation facilities and have long-term contracts to sell electricity. Solar Reserve has a 25-year contract to sell the entire output of its project to NV Energy, the largest electric utility in Nevada.

Unlike other parts of the paragraph in Ryan’s budget, the information about Solar Reserve and Sempra Energy is not footnoted.

Steven Mufson covers the White House. Since joining The Post, he has covered economics, China, foreign policy and energy.
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