A solar energy firm headquartered outside of Atlanta, Ga. has inked a sizable loan guarantee from the U.S. Export-Import Bank, the latest in a string of generous government subsidies and tax incentives that has kept the green outfit afloat while many of its contemporaries have shuttered operations.
The taxpayer-backed bank announced earlier this year it would underwrite the purchase of $780,000 worth of high efficiency solar modules from the Norcross-based Suniva Inc., a research and development outgrowth of Georgia Tech, for a rooftop solar-power project in Mexico.
But the three quarter million dollar loan is not the first time the federal government has shown favor with company.
In January 2010, the White House unveiled a $2.3 billion clean energy investment program in which Suniva reaped $5.7 million in federal tax credits. In March and again in April that year, government bankers at ExIm and the Department of Energy awarded two separate loans, for $2 million and $141 million, to facilitate the company’s exports abroad.
When the ExIm transaction, a short-term $2 million loan to underwrite sales to India, was first approved, a bank press released said Suniva had designs on expanding its U.S. manufacturing footprint to accommodate the growing international demand.
The influx in taxpayer cash came as Suniva announced it would break ground on a $250 million plant in Thomas Township, Mi. After Suniva executives balked at the repayment terms of the Dept. of Energy’s loan, the Michigan’s business authority green lighted a $8.7 million tax incentive to soften the blow.
But those loans and incentives didn’t come without an investment on Suniva’s part, however: federal records show the company has spent at least $380,000 since 2009 on lobbying U.S. government officials.
Despite the Suniva’s vigorous pursuit of government financing, three years and a second ExIm loan guarantee later and still no plant.
Conservative government watchdogs say the millions in loans and tax credits to Suniva, and similar firms like the struggling SolarWorld and now-bankrupt Solynda, typifies the federal government’s mistaken belief it must serve as financier to the green economy.
“The Export-Import Bank is nothing more than a slush-fund for corporate welfare backed by taxpayer dollars,” Club for Growth spokesman Barney Keller told Tipsheet in an email. “It should be shut down as soon as possible.”
A largely obscure federal agency, the Export-Import Bank has quietly offered taxpayer-backed loans to foreign purchasers to expand U.S. exports for decades, but has become a lightning rod for controversy in recent years for the business failings of some if the Bank’s most-hyped green energy transactions.
While Suniva is not in the dire economic straits of similar firms–the ExIm-favored SolarWord, a Germany-based producer of solar panels, is reportedly on the path to insolvency in spite of millions in loans from the bank–the company is not without its critics.
“Suniva should play by the rules all other Georgia companies must follow,” one Georgia economist who wished to remain anonymous told Tipsheet. “ExIm and other crony capitalists in the federal government are willfully manipulating the market, gaming the tax code for the well-connected and hurting the little guys.”