Emergency Spending Bill Not the Place for Energy Loan Guarantees
Jack Spencer /
Every special interest in Washington is looking to hitch on to what was supposed to be an emergency spending bill to provide critical funds for military and emergency response activities. While some may be legitimate programs, most are not an emergency and therefore should not be part of any such bill. Take the renewable and nuclear energy loan guarantee programs for example.
The administration is seeking $9 billion in additional loan guarantee authorization for nuclear projects and $1 billion for renewables. The bill would also appropriate $180 million to support those programs. The authorized amount is what the government will back up while the appropriated amount is what is necessary to administer the program. Loan guarantees are attractive to companies because they subsidize the cost of capital to finance their projects. So while other investors must pay the market rate to borrow for their projects, loan guarantees recipients enjoy lower rates on their borrowing because they come with the backing of the American taxpayer. (more…)