The House Subcommittee on Energy and Power and the House Subcommittee on Oversight and Investigations held a joint hearing today to discuss the “ No More Solyndras Act .” The bill aims to reform the faltering Title 17 Department of Energy Loan Guarantee Program by adding transparency and oversight measures to the program and prohibiting new loan guarantees to companies that applied after December 2011. To date, three out of the 28 loans awarded under the loan guarantee program have filed for bankruptcy, including Solyndra, Beacon Power, and Abound Solar—representing a total commitment of nearly $1 billion.

Unfortunately, this new legislation misses the mark and leaves taxpayers exposed on billions of dollars in high-risk loans that have undergone the same failed process as Solyndra.

The “No More Solyndras Act” leaves taxpayers on the hook for much larger loan guarantees grandfathered into the bill’s December 2011 sunset. If this legislation moves forward in its current form an $8.3 billion loan guarantee for two high-risk nuclear reactors in Burke County, Georgia will remain in the queue. Along with it a $2 billion loan guarantee, for the near bankrupt United States Enrichment Corporation’s uranium enrichment facility in Piketon, OH. Finally, liquid coal, which has never proven to be economically viable, stands to gain nearly another $2 billion in taxpayer-backed loans for a facility in Medicine Bow, WY which has already faced more than five years in construction delays. Defaults from these significantly larger loans could cost taxpayers up to 15 times more than Solyndra.

The bill does include some positive taxpayer provisions. First, it eliminates DOE’s right to subordinate taxpayers’ right to reclaim lost assets in the event of default. Second, it explicitly includes the Department of Treasury in the loan guarantee review process. Finally, it begins to tackle the program’s transparency issues by requesting special reports to Congress. However, the bill does nothing to ensure the process is transparent to the public or address the multiple high-risk loans on the docket before the end of last year.

Since the loan guarantee program was enacted in 2005, Taxpayers for Common Sense has warned it has fundamental flaws. The level of risk taxpayers assume is far too high, the scope of the projects is far too broad, and the secretive process is open to abuse. Multiple independent reviews have also illustrated that the program is fiscally reckless, poorly managed, and prone to serious failure.

The DOE Title 17 loan guarantee program should not be allowed to continue to gamble with taxpayer dollars. The program has failed us once, well, three times; and it will fail us again. This bill falls short of protecting taxpayers from future losses and we look forward to working with Congress to ensure billions more are not lost.

Witnesses appearing at the hearing included: David Frantz, DOE Loan Guarantee Office; Kenneth Berlin, Coalition for Green Capital; Dr. David Kreutzer, The Heritage Foundation; Diana Furchtgott-Roth, Manhattan Institute for Policy Research.