Senators Criticize Auto Loan Effort image

Tuesday, March 13th, at an Energy and Natural Resources Committee hearing, Senators criticized the Energy Department for offering a $25 billion loan program, calling the initiative “virtually dormant.”

Several senators said the government’s loan programs to help utilities, automakers and other companies with green energy efforts should be restructured. Since 2007, when the Advanced Technology Vehicle Manufacturing initiative was created, the Energy Department has allocated less than half of the funds, out of which four totaled $8.4 billion and were given to Ford Motor Co., Nissan Motor Co. and startups Fisker Automotive, Tesla Motors and Vehicle Production Group.

It’s been a year now since the Energy Department hasn’t offered any new auto retooling program and two years since any new major loans. This has made many companies to walk away after years of talks. Sen. Lisa Murkowski, R-Alaska, said many companies have expressed deep frustration about not being able to get a loan answer. Sen. Ron Wyden, D-Ore., said Congress should take a new look at all of the Energy Department’s loan programs.

Energy Secretary Steven Chu defended the handling of the program, saying the government needs to protect taxpayers.

“We would like to see private equity invested in these companies,” Chu said, adding the government wants to see evidence of private support. “We are very focused on driving the cost (of electric vehicles) down.”