House Republicans pass "No More Solyndras" bill

The entrance to the headquarters of bankrupt Solyndra LLC is shown in Fremont, California September 20, 2011.

WASHINGTON (Reuters) - The Republican-controlled House of Representatives passed a bill on Friday that would phase out a program for energy loans after a lengthy investigation into why a now-bankrupt California solar panel maker got a $535 million government loan.

The "No More Solyndras" bill, named after the company that has become a stock campaign talking point for Republicans ahead of the November 6 presidential elections, is highly unlikely to be taken up by the U.S. Senate or signed by President Barack Obama.

But the 245-161 vote gives Republicans another chance to hammer home a message about Obama's energy policies and the administration's management of the economy ahead of the elections.

"What we need is a Keystone economy, not a Solyndra economy," said Fred Upton, the Republican chairman of the House Energy and Commerce committee, referring to the Keystone XL crude oil pipeline from Canada, which Obama put on hold pending further environmental review.

The legislation comes after an 18-month investigation into the Solyndra loan by Upton's committee. It concluded that the Energy Department rushed into the deal, then helped keep the company going despite a series of red flags.

The FBI has been investigating Solyndra for the past year in tandem with the Energy Department's Inspector General, an independent watchdog.

In total, the Energy Department has approved $34.7 billion in loans to 33 projects. Aside from Solyndra, two other companies with loans have gone bankrupt.

Democrats slammed the legislation, saying it ignores successes in the loan portfolio.

"This is not serious legislation, it's a political bill," said Henry Waxman, the top Democrat on the House Energy panel.

"They've been dancing on the grave of Solyndra for so long. Enough is enough," said Waxman, who blamed Chinese subsidies for the failure of Solyndra.

Upton said there are six applications in the Energy Department's pipeline for nuclear plants and more than 40 applications for other types of clean energy projects.

The Energy Department has an additional $34 billion that it could spend on clean energy loan guarantees.

The legislation would ban the Energy Department from considering applications received after December 31, 2011.

The Energy Department would need to have approval from the Treasury Department for any new loans, provide more information to Congress, and prohibit the Department from subordinating taxpayer funds when restructuring troubled loans.

(Editing by Russ Blinch and Alden Bentley)