was put out there. who came after this money and the number ofs people, i think it's $15 billion. we have a slide that shows credit ratings. can we put the slide up? do you have access to that? this is a good score. a b is a good score. i lived on bs. cs my parents were not happy with, but bs were good. a b is a high risk. it's a junk rating. american taxpayers, we risk some of your money. we risked it because we had to take that gamble. so when i look at this, i look at the credit ratings and we're telling people we made good investments for you. the truth of the matter is most of the money went to junk grade opportunities. that brings me down to how do you navigate that territory and

get to the guys that win the money? i was looking at gao numbers. i think 25 got the money. by 7% of the people that applied got the money. my question is, what did the people do to get the money? >> it's everything working in the business development department. >> who does he work for? >> who is he working for? >> he a lobbyist for your firm? >> let me ask you this. before thompson worked for you, who did he work for? >> before he worked for us? >> yes. >> i don't know.

>> it was harry reid. >> we're play and i want you to see something. this may refresh your memory. >> as you drive along i-80 and you see the steam and it may not seem like much, it's geothermal energy. it made 16,000 construction jobs in nevada. harry reid saw the potential just about before anybody else. he got over $144 million. >> senator reid is making that happen. >> harry reid -- >> i'm harry reid and i approve this message. >> i'm sure he does. you go through this and here's my point. there is a way to navigate these waters. when only 7% of the applicants get the price, you have to wonder as an average american in

my home and my business, how did these guys get there and all the rest didn't? we find out that almost every single one of these is tied in in some way to the administration. there is a way to navigate the waters and be successful. the idea is you better be tied in to somebody who is influential. mr. thompson right now is busy. i know that harry reid visits facilities throughout pennsylvania too. i want to know what's going on. the american people are starting to wonder, billions and billions of dollars invested. by a government that picks winners and losers and a lot of it based on highly suspect ways of how do you get there? i wish i had more time. this is an interesting suspect. at the end of the day, people want to know where their money went and how it got there. this is a difficult mab to

navigate. you and i know that. free money is free money. this feeding frenzy he to be phenomenal. when you guys got that information, let's get our share. it's amazing of how they got their share. it's the old story. if you are not at the table, you are probably on the menu. somebody got to the table in a hurry and got a bigger share of the pooi than other people. hardworking american taxpayers deserve to know how that worked out and how it happened. >> i thank the gentlemen. we will come for a second round and get more time. >> i hope so. >> yield to the ranking member, my friend from ohio, mr. kucinich. >> i want to say that i want to associate myself to the concerns that my friend expressed. we are talking about power and money and it has nothing to do with democrats or republicans.

just to show his bipartisan nature, he was able to be appointed as involved in the transition for the then goff forgivens for energy or natural resource issues. the fact of the matter is we can go and i have gone into who is contributing to whom and people are contributing and it's part of the problem with the process. they are good people and people who serve is a good people. the system is rotten and up for sale. the assumption that occurs about this unfortunate nexus is in arguable. what about the programs? >> i would point out that that was the point that the doctor made. >> i don't disagree.

>> a one-party problem. this is a party when you have government handing out. >> the issue of moral hazard is there. i agree with that. also just to make the point, there some of my friends and signed a letter let's get these solar programs moving. i would like to put it in the record. there is bipartisan support for the programs, but there is a partisan debate over who got what and why. we also -- another item i would like to clarify and ask consent, goldman sachs, we know we have a wholly owned subsidiary, goldman sachs testifying, but goldman sachs involvement goes way beyond this subsidiary. goldman sachs stands behind

several of the loan girl an tees granted by doe that don't involve the subsidiary today. i want to insert into the record this article from the "new york times" that states that goldman sachs was involved in the desert sun light solar farm getting a guarantee of $1.46 billion without objection. >> objection. >> so several very large companies participated in projects that received doe loan guarantees and the committees have not asked about their involvement. mr. man sini, it is my understanding that your company is a wholly owned subsidiary of goldman sachs and given that fact, what was goldman sachs's involvement in the 1705 project. >> congressman is you sin itch, to answer that question, i think

you have to understand how we structured this project. we structured this project like we would any other project financing further construction of a power practice ject. >> what was their involvement? >> the involvement at goldman sachs was derivative to the process. if i could explain, first at the operating level, we had to go out and secure and negotiate a power purchase agreement with the off take or a utility in this case. for the purchase of the power. the next thing we would do is to select an equipment provider and a construction manager and then and only then would we go out and try to find the financing package that would make this project viable. >> what was goldman sachs's involvement? >> goldman sachs provided equity capital to make $116 million of

commitments to this project. we are in fact the project leading financier. >> thank you, mr. rock wits. it is my understanding that your company is comprised of warehousing operations throughout the world and the project deals with placing solar panels on the roof. i understand that bank of america played a very significant part in putting the deal together. what is bank of america's involvement in this project? >> congressman, bank of america would be the lender to the extent that we roll out the solar on these roofs. >> to what extent, sir? >> well, to the extent of roughly 80% of the project cost. >> how much is that? >> it's hard to say. the maximum amount of the program is $2.6 billion. >> thank you.

mr. man seen, your company has been the subject and this committee and you are both requested to identify and was your parent company, goldman sachs ever given a request or invitation to testify to your knowledge? do you have any idea? >> to my personal knowledge, i don't. >> how about you? >> no. >> was it the deal maker and project of bank of america to send the request? >> not to my knowledge. document requests, i don't know. >> so mr. chairman, i want to say that i think that this committee could be ever more effective in its work if we were to have goldman sacks and bank of america here to answer questions about their involvement. since they stand behind it. these are in the scheme of things, these are small companies. in terms of goldman sacks and bank of america, they are at the

highest level. if we were able to bring them forward, it's the kind of questions that mr. kelly raised. it would be an opportunity for us to really go deep and find out what's happening and also to go into the interplay of the politics and the contributions. >> we will now yield to the gentlemen. >> thank you, mr. chairman. i thank you for the courtesy of allowing me to participate. i want to talk about something different and follow-up on some of the things that mr. kelly and kucinich are raising. i want to deal with the issue that he mentioned which was the true impact of these programs. as i said and listen to you folks testify, one of the things that was readily apparent is whether or not these projects would have been done anyway. you said you started this in 2006. you started doing this program and have actually put some of these photo systems on your

roofs before the loan program started. is that right? >> congressman, that is true. those programs prior to this were almost entirely financed by the utilities that we in essence -- they financed that program at that point in time. >> on the program thaw testified on regarding the program in california, i understand that that has not actually led to any installation of the operations on your roof tops. is that correct? >> that is correct. >> the 1705 program in your circumstance has not generated any stimulative effect, has it? >> congressman, if you don't mind, let me just give you a little bit of context to that. the program itself is a four-year program designed to start on september 30th of 2011. so if you look at it -- >> you had to start with the

program requiring to you start september 30th, 2011. >> correct. we had started construction at that point in time. the overall program was largely to be done in years three and four of a four-year program. so it would be if you will, rolled out overtime. >> i understand that, but i'm not being critical of the program. the difficulties in having the supplier go bankrupt, but the truth of the matter is that this is a program that was supposed to create jobs right away. it looks like it hasn't done a single job in your circumstance. i understand that there was 5,000 folks that work for your company and i think that the report said the total amount of loan guarantees and your partners have are $5.2 billion. i congratulate you on employing 5,000 people, but i go back to the comment on the ratio of jobs

to the amount that is involved in the equation. i'm a simple country lawyer, but i can handle the math. i get a million a job. am i doing the math right on that one? >> first of all, i should clarify. it was a flight of rhetoric. that's 5,000 people who worked at full time employees. the three projects may be like roughly employ 4,000 people directly. >> i can say i don't like that more. >> the impact is obviously a multiple event, but as the ceo of a company, counting jobs is something that policy makers have to do. >> we have to do. let me ask you, with these projects have gone on, but for the 1705 program sf. >> these three projects that we were involved in would not have happened without the 1705 project, particularly -- let me

put it this way. no way the project would have happened. the aqua calienty project maybe a one in five chance. the first solar -- i said cvs is in five. maybe a 40% chance. the amount of money and the private sector did not -- contrary to what the doctor said, the private sector project finance market was not large enough to do projects of this size. most of the banks involved in the project are european banks. they have not been in the best condition over the last few years. >> let's talk about the cvsr project and there is a second round of questions. you said it's a one chance in four going on? when did you start the analysis and start planning for the project? >> congressman, one of the things that i'm sorry, but all the three projects, nrg was not

the first. we bought in well after they were started. i can't answer the question. >> where did you buy the project? >> on cvsr? >> yes, sir. >> we signed the purchase agreement in november of 2010. >> how far along was the project at that time? >> the project was in the development phase and had most of the permits and a letter of intent with the government in terms of the 1705 financing of projects of this size, we were not going to get involved unless you had the letter of intent. we knew it could not provide that size of loan. >> i have never done business in california for something which i am grateful, my end understanding is not it's not a quick process to get a letter of intent. would that be a reasonable statement to make? >> i mean your generalization that california is a difficult place to permit every type of power plant is a true

generalization. i would agree. the plant that doesn't use water has less issues and has no emissions and less than tro additional plants and has land use issues. we were not responsible for the permitting. >> somebody thought this was going to go forward before the stimulus program was enacted in 1705. >> well, yeah. sun power started the development and i'm sure they had reason. i don't know how they thought and thought before the financial crisis. it was not inconceivable, but after the financial crisis, there was no way the private sector was coming up with a billion loan. >> i hope there is a second round. >> we will have a second round. have there been any solar panels put on the roof tops?

>> no. as of right now, there is no -- what have you done? in his first testimony, he said you haven't drawn down the dollars. i understand it's a three or four-year phase, but you still approve and have gone ahead and haven't built anything and have any construction to put panels on the roof tops to get the loan girl an tee from the department of energy. >> right. again, i would first of all let me say that was almost by design. the first couple, 15 to 18 months, we did not project to do too much. >> how much money did you get from the department and what's the loan amount? >> the total commitment sibelieve $1.4 billion. >> 1.4 just waiting there and you can use it whenever you want. god bless america. that's a good deal. >> with all due respect, i think let me explain the way the project works. we go out and identify utilities

that are looking to sign power purchase agreements. >> have you done any construction at any part of phase one? have you done anything at all in the phase one part of the program? >> yes. we prepared the 15 roofs in southern california for solar in the future. >> you prepared them, but no panels have been put up? >> no panels have been put up. >> have you prepared for a follow-up rating? >> you don't have a project at this point in time. >> you have performed any solar panels? >> we have not performed any solar panels. >> you don't have any waiting let alone put them up. >> we're have not purchase them. >> i would like to enter for the record and e-mail from our staff to lawyer from bank of america where we just asked questions regarding the project and this project, four different questions. ppa has been signed and

performed solar panels and returned for a follow-up grading and has project amp begun construction and they said no to every one they is a no to every one of them. yet, you still get to keep the money. this is amazing. this is march and we're supposed to be moving on this by september 30th. we'll give you a copy. without objection, i'd like to enter into the record. you have three projects that you've gotten? >> yes. >> how much was the money again, total? >> how much is total amount of loans for those three projects? it's about $4 billion. >> you received those solely on the merits of the project this is to the point, there's nothing based on friends in high places and political connections. it's all based on the merits of the project? >> i believe so. >> have you been to the white house to discuss this issue and talk about how important these

loan guarantees were? >> to discuss loan guarantees? >> have you been to the white house? >> yes, i've been to the white house many times. >> how many is many times? >> between the bush white house and the obama white house, 14, 15. >> since the 705? this administration? >> i'd say six or seven times. >> who did you talk with when you were at the white house? >> i was part of large group. once meeting with president obama. >> did you talk about this loan guarantee program when you met with president obama? >> we talked about climate change. >> who else? >> vice president biden. i spoke about the clean energy standard. i spoke with valerie jarrod. >> you are also involved with the bight source project as well, correct? >> that's the ivan paul project.

>> if we can put the e-mail up too, are you familiar with this e-mail? this was brought up in our last hearing when mr. wolard was here with bright source. the e-mail at the department of energy asking him to edit and proofread a letter that bright source was going to sent from mr. bryson to mr. daly, are you familiar with this? >> no. >> are you involved with any way? >> i have nothing to do with this. >> nothing at all? didn't know about it? >> no. >> did you talk to the white house in those seven visits, did you talk to anyone there about this project? >> never. i never spoke to anyone about this project or any other renewable loan guarantee. only about the nuclear. >> you've talked a lot about

energy issues in general. do you think it's maybe out of the ordinary or not customary to have a company send an e-mail to the department of energy asking those folks who will be responsible in determining whether you get the loan or not? do you think it's unusual to ask the department of energy was going to send to the white house chief of staff. >> it's nothing that i've never done. >> you think it's uncommon to get that specific and ask the person who is supposed to say ya or no on a loan project that we'd like you to edit this letter? >> i don't think i've sent an e-mail or a letter to the white house. i don't have a lot of experience

in this area. >> maybe you didn't have to send sit. you were going there all the time. i think the gentleman will go to the second round of questioning and yield to the ranking member for four or five minutes. >> although members of congress in both parties have supported 1705 loan guarantees for projects their districts, it now appears that some of my friends in the majority have had change of heart in a report published in march, the majority argued that d.o.e. amassed an excessively risky loan portfo o portfolio. there are experts that disagree.

congress authorized a $2.74 billion for potential losses in the d.o.e. 1705 loan guarantee program. according to several analysts have after the collapse of sylindra and the d.o.e. loan program ended up being a fraction of what the government budgeted for the losses. bloomberg government came to a different conclusion than the majority. bloomberg's recent report loan guarantee program the loan portfolio projects unquote. now, do you agree with the majority that armat technologies project is excessively risky or it's a lower risk project? why? >> the three projects that

received the d.o.e. loan guarantee are very low risk projects from a technology point of view. they are similar to many megawatts using the same technology. it was all about expanding and not innovation. >> i understand, but the risk was low? >> very low. >> as i understand it, one reason why the portfolio can be considered low risk is because most of the projects that received 1705 loan guarantees are for power generation and d.o.e. required these companies to have long term agreements in place with nearby utilities to purchase the power once it was built. this means that the projects have a guaranteed income stream. which greatly reduces risk.

between the power generation projects like the loan guarantee and project finances. do you already have agreements in place to sell power to major utilities once the projects are completed. >> you couldn't do it if you didn't have an agreement in place? >> we couldn't do it with the d.o.e. >> it doesn't work financially? >> it could be very difficult, very difficult. >> otherwise you'd be stuck with a white elephant? >> there are very few of those projects that have succeeded without long term contracts. >> herb alison found the d.o.e. support between power generators and utilities in place like

company do you agree with this live assessment. the majority has documented that project amp has yet to start generating solar energy. that fact is disappointing. can you tell us how much taxpayers money have been drawn down by the project so far? >> zero. >> how has the project -- what was that answer? >> none. >> has the project designed to mitigate, how was this loan guarantee designed to mitigate taxpayer losses? >> i would say three things. one, we're not going to move forward unless we have a long term power purchase agreement, which is a 20-year agreement, 15 to 20 year agreement with the utilities. we're not going to think about, we're putting up the equity or us and our financial partners

are putting up the equity as well the lender has 20% that's at risk that's not guaranteed. nearly 40% of the project is at risk before government has the guarantee. we're not going to put up -- >> the question here is the performance. i think it's clear that this program is performing better than expected in financial terms. one of congress main goals was to spur technological advans. do you believe your 1705 finan spurring technological advances? are you spurring technological advances with the program that's been financed by 1705? >> what do you mean snp. >> are you creating te te