In the past month, federal watchdogs have raised two red flags over the Department of Energy’s green bank, a.k.a. the Loan Programs Office.
In April, the Energy Department Inspector General reported that the Loan Programs Office had failed to heed the advice of its solar energy expert, who had warned against the issuance of a stimulus-funded loan guarantee to Abound, a Colorado-based solar panel manufacturer that went bankrupt, costing taxpayers scores of millions of dollars.
Last week it was the Government Accountability Office’s turn. On May 1, the GAO released a report titled, “DOE Should Fully Develop Its Loan Monitoring Function and Evaluate Its Effectiveness.” The opening of the executive summary does not inspire confidence regarding the Energy Department’s ability to play the role of green energy investment banker:
“The Department of Energy (DOE) has not fully developed or consistently adhered to loan monitoring policies for its loan programs. In particular…policies for evaluating and mitigating program-wide risk remain incomplete and outdated.”
Lest you think that GAO was picking at needless details, consider: Included among the “loan policies” that the Energy Department has “not fully developed” are the credit reports (!!!) on the loan applicants. That’s a pretty glaring problem for a LOAN Programs Office that already has a $30 billion portfolio. Report reposted below.