let me introduce nrg. we're a fortune 300 company with 25,000 megawatts of coal, gas, wind and solar generation. it's nuch to power more than 20 million homes. we also serve more than 2 million customers in several northeastern states. important to our discussion today is nrg is not a racte-basd utility. our shareholders bear 100% of the risk which is in stark contrast to rate-based utilities which tend to socialize the risk of their capital projects of their state. i ask that my written testimony be included in the record. nrg includes a majority interest under section 1705 and pictures of these three projekts taken very recently all appear next to me. i'm bleezed to report to you on the progress of these projects through the critical construction phase because that's typically the highest phase we are also involved in the rooftop projeblgt together with our partner prologics. there are no draw downs on the project-amp loan. so let me go back to the three projects which are under construction. that is the

important to our discussion is nrg is not a rate-based utility. our shareholders bear 100% of the risks and of the success of our operations which is in stark contrast to rate-based utilities that oeshlize the risk of their capital projects among the rate payers of the state. i asked that my testimony be included in the record. nrg owns an interest in three projects that received loan guarantees under section 1705 and pictures of the three projects taken recently all appear next to me. i am pleased to report to you on the progress through the critical construction phase because that's typically the highest risk phase in the life of any power generation asset. we are involved in the ownership of a fourth section 1705 called project m with the partner, but to date there have been no drawdowns on the loans so there is no progress for me to report on. let me go back to the three that are under construction. we own a 50% interest in the 392 mega watt project in san bernardino county, california. that's the picture on the left. ivan paul when it's compl

that was 5,000 people that work at nrg, full-time employees. the three projects you're talking about, and maybe you'll like this number more, is that it roughly employs 4,000 people directly. >> i can assure you, i don't like that money more. >> but the indirect impact is obviously a multiple of that. but, you know, passas a ceo of company, the accounting is what policymakers like to do. >> mr. rakowich, would these projects have gone on, but for the 1705 program? >> congressman, the three projects that we were involved in absolutely would not have happened without the 1705 project. there's no way the island project would have happened. without the federal loan it may be one in five chance. the first solar cbsr 15, maybe 40% chance. the amount of money, congressman, the private sector did not -- i mean, contrary to what dr. de rugy said, the private sector market was not large enough to do projects of this size. most of the banks involved in projects are european banks, and they have not been in the best condition in the past few years. >> let'

that nearly 19% of a 1705 loans went to subsidize projects that were backed by large companies such as nrg energy, or even the financial giant goldman sachs. in practice it is hard to argue that these companies would have had a hard time having access to capital to fund projects that would have been viable. second, according to the department of energy data, under 1705, $16 billion in loans were guaranteed, and 2388 permanent green jobs were created. that means that for every $6.7 million in taxpayer exposure, one job was created. these numbers dismiss this loan program is ineffective -- as an effective job program. but while the data speaks for itself, the real problem with the 1705 loan program lies below these numbers. it even goes beyond the recent waste of $538 million of taxpayers money following the failure of solyndra. solyndra is a symptom of more fundamental problems that make loan guarantee programs in general and d.o.e.'s loan guarantee program in particular a bad deal for taxpayers. such programs suffers from three main problems. first, every loan guarantee program transfers t

>> 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 i

the mentioned that nrg has actually invested $1 billion in the three projects we've discussed previously. i think the notes i had said that $400 million of that, for example, were in the california valley solar ranch cvrs program. i think that's an important -- you went on to say that in blunt terms, we don't get repaid unless the government has been repaid. i think you hit on an important issue there, because i think a lot of the frustration that you hear amongst the panelists today, at least the members, is a reflection of what folks back home are hearing. which are why are these folks getting paid when the taxpayer is still on the hook. they see the owners and sometimes officers of these companies making money when the taxpayers are still ultimately on the hook. i want to talk about this for just a second. are you selling us, sir, on that $400 million in equity, there's no preferential payments, no return on that equity until the debt has been repaid? >> congressman, what i'm saying is in the waterfall of payments, the debt service happens before there's any returned equity. i don't k

the end of your both written and oral testimony, which i think is important where you mentioned that nrg is invested a billion dollars of your own equity in the three projects that we discussed previously. i think the notes said that 400 million of that were in the california valley ranch, the cvsr program. you went onto say that in blunt terms we don't get re-paid unless the government has been re-paid. you hit on an important issue there. a lot of frustration that you hear amongst the panelist today or the members is a reflection of what folks back home are hearing. why are these folks getting paid when they are still on the hook? that's what they saw with fannie mae and solyndra. are you telling us on that $400 million in equity there's no return on that equity until the debt has been repaid? >> i'm saying in the water fall of payments, the debt service happens before there's any return to equity. i don't know the month on month, year on year but debt has a high priority than equity. >> you say the debt service is above the equity on the water fall. what about the repayment of the pri

small businessed a nrgs. >> we are very, very excited. >> from breakout sessions to kneltworking events, the main focus was on helping entrepreneurs in three key areas. the three c's. capital, contracts and counseling. >> without the capital, you can't continue your business or even consider to grow it. so, obviously, getting the sva loan really helped us make the jumpstart and actually our second sva loan took us to a new building and we were able to double and triple our size eventually. >> though it can be a time-consumer process, business owners were encouraged to pursue contracting opportunities. >> small businesses get the revenue they need to grow to create jobs and the federal government gets access to some of the most innovative small businesses, the most creative businesses. oftentimes with a direct line to the ceo. >> mark deveaux is a co-lead sponsor of national business week and talked to us about the main resource score provides. >> some people want to grow, some people want to exit their business so we are there to help them with that. >> exporting was also a hot topic. s

. >>> senator john mccain is accusing the obama add nrgs of allowing security leaks for gain. >>> rick scott is still thumbing his nose at the justice department with his outrageous voter purge. >>> chris rock cracks a joke about the mormon recent history of discrimination. we'll take a closer look. share your thoughts on twitter. we'll be right back. [ male announcer ] this is corporate caterers, miami, florida. in here, great food demands a great presentation. so at&t showed corporate caterers how to better collaborate by using a mobile solution, in a whole new way. using real-time photo sharing abilities, they can create and maintain high standards, from kitchen to table. this technology allows us to collaborate with our drivers to make a better experience for our customers. [ male announcer ] it's a network of possibilities -- helping you do what you do... even better. ♪ >>> welcome back. a question about security leaks drew president obama's ire today during the news conference he held. >> the notion that my white house would purposely release classified national security informat

you mentioned nrg has invested over a billion dollars. the notes i had said $400 million of that were in a california program. it is an important -- you went on to say in blunt terms we do not get repaid, the government has been paid. a lot of the frustration that you hear today is a reflection of what folks back home are hearing, which is why are these folks getting paid? now they see the owners and officers of these companies making money when the tax payers are on the hook. aren't you telling us on that $400 million there is no preferential payments, no return on that equity until the debt has been repaid? >> in a waterfall of payments, the debt service happened before there was any return to equity. i do not know the month on month, but that as a higher priority than repayment on equity. >> about the repayment of the principal on the loan? >> the debt service is interest plus principal. >> you did not collect fees and management consulting fees for the management of the project, correct? >> operating fees for the project are pretty sm