Obama's Green Programme that Sparked Solyndra Scandal Turns Profit

A US government renewable energy programme described by Republicans as "disgusting" and "a colossal failure" has turned a profit for the first time.

The Loans Program Office became a stick to beat President Barack Obama with during the campaigning for the 2012 election, after the solar energy company Solyndra defaulted on a $535m loan it received from the Department of Energy.

It was followed into bankruptcy by start-ups Fisker Automotive and Abound Solar, all of which received loans from the office.

Now, it has reported a profit of $30m, after collecting interest payments of $810m on total loans of $34.2bn, Reuters reports.

The lending programme was borne out of 2005's Energy Policy Act and was designed to stimulate the US' fledgling renewable energy sector. The intention was never to make money but to subsidise an industry that has always struggled to gain commercial financing. An initial $10bn was set aside to cover those losses.

"Part of this shortfall [in financing] can be attributed to the recent domestic financial crisis and global economic downturn. But much of it is due to the unique features of large-scale energy projects, which make traditional financing difficult to find—even in flush economic times," reads the initiative's website.

The programme allows renewable energy firms to borrow from the Treasury or private sector, with the Loans Program Office issuing a substantial guarantee on the loan. It's a model which is common in more traditional sectors, with the likes of Boeing and Caterpillar being substantial beneficiaries of the Export-Import Bank of the US, which guarantees loans to exporters to buy US goods.

However, during the run up to the last election, high profile Republicans rounded on the Obama administration's support for the programme – claiming that he was using it to assist his campaign funders.

Now, though, officials are toasting its success.

"Taxpayers are not only benefiting from some of the world's most innovative energy projects... but these projects are making good on their loan repayments," Peter Davidson, executive director of the Loan Programs Office, told Reuters.

The US Energy Secretary told NPR that it "literally kickstarted the whole utility-scale photovoltaic industry".

The news may offer some support for Obama as he faces Republican opposition to the climate change deal he agreed with China, upon his return from Beijing. Senate leader Mitch McConnell has suggested that Obama will not be in the White House for long enough to see the plan through and, given the widespread Republican hostility to green initiatives, the implication is that if Democrats fail to win 2016's election, the deal will be stopped.

"This unrealistic plan, that the president would dump on his successor would ensure higher utility rates and far fewer jobs. As I read the agreement it requires the Chinese to do nothing at all for 16 years while these carbon emissions regulations are creating havoc in my state and around the country," McConnell said.