LOS ANGELES (Reuters) - The former venture capitalist who now is in charge of about $70 billion in federal funding for alternative-energy projects is trying to bring a dash of private-sector efficiency to his new government job.
But it hasn’t been easy for Jonathan Silver, 53, who is coming up on his first anniversary running the Department of Energy’s much maligned loan-guarantee program.
Silver’s proudest near-achievement is a plan to green light more than half a dozen projects by the end of the year. That’s light speed for a program that took three years to offer its first guarantee, enraging alternative energy fans.
Rival nations seem to be giving more, and often faster. Through the China Development Bank, Beijing has extended credit guarantees to several solar companies this year, most recently $8.95 billion for LDK Solar Co. Ltd..
Clean energy is a major goal for the Obama administration, which sees it driving job growth and helping the environment, but progress has been slow at best.
A government guarantee is often the difference between a clean-energy project getting built and gathering dust.
“We have the capacity to remain a leader in these industries, but it will require a concerted effort on behalf of the government and the private sector, in partnership,” Silver said in a recent interview.
Silver says he’s beefed up staffing, streamlined procedures, and the program is “reaching ramming speed.”
The renewable-energy loan program began in 2006 but the first project wasn’t approved until 2009. Just 14 have been approved, representing over $14 billion in loans.
Silver won’t say how many applications the Department has received total, but says it is more than he has subsidy for.
Before taking the job in November, Silver was managing general partner of Washington, DC-based Core Capital Partners, where projects include investments in alternative energy.
Today, he reports to Energy Secretary Steven Chu, a Nobel-prize winning physicist. But even with a direct pipeline to the boss, the job is challenging.
He must oversee tough negotiations with applicants, fight entrenched bureaucracy, and finesse relationships with other agencies that weigh in on the loan decisions such as the Office of Management and Budget.
When asked what he actually likes about his job, Silver breaks into peals of laughter and explains he’s not used to upbeat questions.
But he does have an answer. “I think it’s incredibly exciting, intellectually stimulating, and a tremendous amount of fun to be part of the launch of a number of industries,” he says. “I can’t imagine doing anything else.”
A former McKinsey & Co. consultant and policy adviser to the Clinton administration, Silver knows how Washington works and has good private sector experience as an investor, says Tim Newell, an advisor to Santa Monica, Calif.-based investor U.S. Renewables Group, which has several applications pending.
“That’s a relatively rare combination,” Newell said.
Many alternative-energy executives fret that DOE delays will cost them guarantees under a program with a September 2011 deadline.
One of the notable projects waiting for word on loan guarantees include the world’s biggest solar plant, a proposed 1,000 megawatt project in Blythe, Calif., under development by Solar Millennium AG, Ferrostaal AG, and Chevron Corp. A project spokesman didn’t respond to requests for comment.
Many companies hope for a loan guarantee by year end, so they can break ground in time to qualify for a separate program at the Treasury Department that provides a grant of up to 30 percent of the total cost of a renewable-energy project.
DOE is sensitive to the deadline, but ultimately, “we’re not responsible for the (Treasury) program,” Silver said.
That type of attitude is “the weak link in this whole program,” said V. John White, executive director of the Center for Energy Efficiency and Renewable Technology, an advocacy group in Sacramento, who says agencies should work in concert.
Even under the best circumstances, the evaluation will still take several months. “We have a responsibility to the US taxpayer to get it right,” Silver says.
Reporting by Sarah McBride. Editing by Peter Henderson, Gary Hill