Trump Recovers Taxpayer Cash On A $1 Billion Obama-Backed Solar Plant That Was Obsolete Before Ever Going Online

From The Daily Caller

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The Department of Energy reached a settlement Thursday to recover $200 million in taxpayer funds from a loan the Obama administration distributed in 2011 to finance a $1 billion solar power plant that was deemed obsolete before it could officially go online.

The settlement between DOE and Tonopah Solar Energy must now be approved by a bankruptcy court, the Las Vegas Review Journal reported.

The DOE provided a $737 million loan to Tonopah in September 2011 for the purposes of financing the $1.1 billion Crescent Dunes Solar Energy Project in Nevada. The agency disbursed funds for the plant in 2011 and 2013 before the project experienced problems requiring improvements, rendering the Crescent Dunes obsolete by 2015, Bloomberg reported in January.

Thursday’s settlement will allow the DOE to recoup a portion of the $424 million Tonopah owes. The plant experienced an outage in 2016, forcing a shutdown lasting from October 2016 to July 2017, the Wall Street Journal Editorial Board reported in January. Another outage occurred in April 2019 and is ongoing.

Both problems were a result of issues with the facility’s hot salt tanks, TheWSJ Editorial Board noted.

“This project has consistently faced technical failures that have proven difficult to overcome. The Department’s decision was made after years of exhausting options within our authority to get the project back on track, given the significant taxpayer investment the prior Administration committed to this project,” Shaylyn Hynes told the DCNF.

DOE officials sent a default notice in September before Crescent’ only customer, NV Energy, terminated its purchase agreement. (RELATED: Another Solyndra? Lawmakers Worry This Obama-Backed Solar Project Could Fail)

SolarReserve, the developer behind Crescent, sued for the dissolution of Tonopah Solar Energy LLC. The developer told a federal court in November that “the plant is moribund—neither generating energy nor revenue” and had debt of more than $440 million with “assets of much less value,” TheWSJ Editorial Board reported.

ACS Cobra, another developer that aided in the project, would control Tonopah once the DOE is free of its obligation, allowing the developer to make appropriate repairs and eventually negotiate with of one or more new Purchase Power Agreements at competitive rates, Hynes noted.

87 thoughts on “Trump Recovers Taxpayer Cash On A $1 Billion Obama-Backed Solar Plant That Was Obsolete Before Ever Going Online

  1. Solar and wind projects exist for one reason and one reason only.
    They exist to not to harvest sunlight and wind energy. They exist solely to harvest taxpayer-provided subsidies, tax credits, and other “free money” loans from the politicians the investor have “bought.”

    • How are so many people, predominately “highly educated” people, not smart enough, blind, or invested in it to not realize it?

      • That’s the thing– blindness. Probably also trying to pay penance for their green crimes.

        “If I pay enough money to this asinine energy project, then I will be absolved of my green crimes!”

        • Don’t forget their “white privilege”! That is the main reason these idiots support any of this crap. Morons.

      • “Highly educated” people are the easiest to swindle. They often think they are too smart to be wrong or to be conned. What’s global warming if it’s not one big swindle?

        • And academia has become a progressive sewer. So basically the ‘education’ itself is the con.

          • Love the “progressive sewer” analogy. I feel badly for the folks who are sucked in by this con by so called educators.

          • Hammer meet nail! Exactly right Joel. “highly educated” doesn’t equate to intelligence Especially in the 21st century, Highly Educated is better equated to “Snooty pseudo-intellectual”

            And the ones running around on social media claiming scientific questioning is “Science Denial” earn the associated Snooty Psuedo-Intellectual title of “unable to find his/her bum with both hands”

        • The problem is we have too many “educated” people who have never taken a math or science class while getting their “education”. The courses they take are all subjective and they never learn to think. So, they are “educated” but have no knowledge or wisdom.

          • When I did an external correspondence degree course in the mid-1980’s, I had to take a humanities (or another non-science) module in addition to the maths and computer modules. Any indication that this works in the OTHER direction (i.e. that humanities majors have to take a science module)?
            -Didn’t think so!

          • Also, you can’t count people who spent months only doing intensive training of derivatives and anti derivatives as learning math. They are learning a technical aspect of a discipline of math, that’s all. Some of them (who had their diploma with a more than average math mark) don’t know intuitively the relation between derivative and tangent line!

      • Apparently people had reason to think the technology was viable.

        … a 10-megawatt test facility in the Mojave Desert decommissioned in 1999 that had shown it was technically feasible to use molten salt to store and generate power. link

        The disturbing thing is that the pilot plant did not demonstrate financial viability. To top it off either the pilot plant didn’t really demonstrate technical viability or Tonopah got the technology wrong.

        My wild ass guess is that management was told it would be too expensive to build the project right. They decided to cheap out and pray. Hail Mary

        • A more likely possibility is that the pilot plant didn’t actually demonstrate technical viability, it was just a bunch of managers, saying trust us – if we build a full-scale one, we can fix those ‘little problems’.

        • Since it wasn’t their money, they knew that they could secure additional funding from the taxpayer to fix the glaring design deficiencies. They had a flow sheet and a test facility to show which unit operations were feasible and which were not. In many companies, there is a team that checks your work, re-simulates the process, and estimates the economic performance. This helps reduce the natural human bias to see your idea through rose-colored glasses. Building a plant that you know won’t work usually happens on tax-payer funded projects (F-35, for example) where the cow is always going to give you more milk. In private enterprise, this type of behavior causes bankruptcies and dismissals.

      • It’s like believing in fairies. They want solar power to be real so desperately that they think if they believe it, it will be so. This is a form of magical thinking that Leftists, even intelligent one, employ.

      • “Highly educated” people are often the easiest to swindle. They often think they are too smart to be conned. After all what is global warming but a little bit of junk science and one big swindle?

        • Please excuse the double posting. I thought my original comment (posted above) didn’t get through.

      • “Think of how stupid the average person is… and then realize…half of them are stupider than that!” – George Carlin

        • “Think of how stupid the average person is… and then realize…half of them are stupider than that!” – George Carlin

          Say 75%. They’ll not recognize the error.

        • Art, it is not just stupidity. In fact I believe that is the smaller part. Lust for power on the left rules their actions. What is virtue signaling, pandering to violent protestors, vicious racism and discrimination against white people wherein they are punished solely for their race, and vicious hate and violence against anyone who does not follow their political beliefs. All of these things are only tools used in their lust for power.

    • Not for much longer, they’ll soon be subsidy free!
      “Researchers at Imperial College in London conducted an exhaustive review of all European offshore wind installations since 2006 and concluded that offshore wind may soon be so cheap that newer installations will generate electricity at below wholesale prices, meaning government subsidies will no longer be required. In fact, by mid-century, those wind farms may actually be paying dividends that lower the cost of electricity for everyone. Even better, the industry will create tens of thousands of new jobs.”

    • I’m coining a new term for what you describe, tell me what you think: “rent-seeking”. Clever, huh?

    • And good luck getting a new ‘competitive’ contract, which is code for not paying what they used to. Thank goodness. If they get the assets for a song, then maybe it will be profitable with whatever subsidies they will get, but the original equipment and subsidy that has now gone kaput, is lost forever, and that was taxpayer monies for the original loan from the Feds. If it can’t stand on its own two feet financially, then it shouldn’t probably be built. And then could it even pass a real environmental review, without permits for cancelling all the birds and bats, and insects in this case. Appears to be all smoke and mirrors. Mainly mirrors and a pinch of salt. Must be embarrassing…

  2. I often wonder if all these ‘progressive’ government benefactors to solar & wind schemes also dropped a shedload of taxpayers’ loot on dotcom startups in the ’90s.

    After all, the prospectuses have exactly the same promises.

      • Think of the irony….
        “… is expected to support 45 permanent jobs. “
        Over 700 million for 45 jobs…..just $16.4 million per job, which turned out to be not-so-permanent. Nothing like green jobs to stimulate the economy and provide a secure future for the working class….and the GND claims green job creation as one of it’s benefits. Someone got the 16.4 million per worker, just not the workers…probably 45 climate grifters…./s

          • Not sure how this comment – already made elsewhere – got duplicated here. The reply I was working on for here was:

            “… is expected to support 45 permanent jobs. “ is not just irony, it’s also ignorance. You don’t run a power station for the direct jobs, you run it for the indirect jobs. Think: A fully automated power station delivering a lot of cheap energy would generate a lot of new jobs. Just not in the power station itself.

          • You are right, Mike…..If it created 45 jobs and a few billion of reduced costs in industries that use electricity, therefore more jobs through competitiveness in those industries….but it didn’t…

  3. What do you suppose the odds are that this facility will ever generate power again? 100:1 against?

    It’s like the underpants gnome plan:
    1.) Collect sunlight
    2.) ?
    3.) Profit!

  4. Stop the presses !

    Will somebody please alert Pravda (a/k/a the N. Y. Times), NPR, PBS, CNN, MSNBC, the WaPo, the La-La Times and the rest of the dopes.

    They’ll want to ignore this news.

    • Exactly.

      You will never see an extensive report at NPR of this rotten deal, complete with assorted quotes to support the target narrative.

      Question: How many bonuses were awarded to the politically connected execs before and during the bankruptcy process? That was also an issue in the Solyndra case.

      • Electrical heaters are required for the salt to stay liquid — in a prolonged power outage, the colder parts of the heat transfer loop might/will solidify. Did any of the engineers designing this rube-goldberg machine look at the power used to keep pipes heated? Also, massive insulation is needed and used to prevent solidification and prevent energy loss in the pipes and storage tank. A small proof of concept plant has a much smaller surface to contained volume ratio in pipes and tanks than a larger, full scale, plant. Been 50 years since I studied MSR’s but as I recall it is a factor of radius squared increase in heat loss with same thickness of insulation. Corrections welcome.

    • Yes, this is that one.

      I wondering if the “owners” are responsible for the clean up costs that will involve removing all of the mirrors – sort of the way nuclear plants are forced to set aside funds for decommissioning and waste storage.

      • On many such endeavors the original “principals” are long gone, with fat wallets, and no worries. Others are now involved to clean up the mess. Keeping your tax dollars at work.
        Don’t expect Obama and his friends to pay. They did this for the climate and you, so you pay.

    • Was? If the mirrors are still there, unshuttered , presumably they still are burning birds and will continue to do so until they fall apart a thousand years from now given the low rate of erosion in a desert. Could not the Sierra Club or WWF intervene to save what is left of the local avian population?

  5. This is a good display of how Obama’s political due diligence worked.

    From that Administration:
    “We don’t pick winners.”

    Postscript: They went out of their way to pick special losers with taxpayer money piled on while ignoring real due diligence used by any rational investors and also ignoring even the best of breed in renewable energy and their cost of power production. “Technical failures” is by the way a common thread throughout these special losers, not just this project.

    Postscript question: Was DOE staff told to look the other way on Tonopah like they were told on Solyndra? Did Harry Reid benefit from this made-to-order loser and did the California delegation in the Bay Area benefit from the Solyndra made-to-order loser?

  6. Tonopah whatever its failing is an attempt to combine solar collection and solar energy storage.

    On the subject of solar energy and energy storage, I attended a talk roughly 10 years ago by then CEO John Rowe of Exelon. I cannot recall where wind was on the cost curve, but at that time he claimed that solar was at 30 cents/kWHr whereas he stated “we could build a nuclear plant, today, and supply electricity for 10 cents/kWHr at the bus bar.”

    His audience in the auditorium of the State Historical Society at the University of Wisconsin-Madison nodded at the 10 cents/kWHr remark, but I cringed. “At the bus bar” means, largely, the off-peak wholesale electric rate before paying the considerable retail markup charge on your home’s electric bill. It went “woosh” right over the heads of this audience of academics that 10 cents is really expensive electricity and 30 cents is truly expensive power.

    His other remark was that “wind is a natural gas play.” What I understood by that is that in the absence of grid-scale energy storage, you are going to need 100 percent backup, for which natural gas-fueled power generation then as it is now is the low-cost lower-carbon fossil energy source. What he was trying to communicate is that wind then, and perhaps solar now that photovoltaic has come down in price, is a way of “stretching” natural gas as a source of energy, much as corn starch can “stretch” but not completely substitute for the meat content of a soup.

    I posted a while ago on Slashdot a while back on John Rowe’s remark about renewable being an enhancer to natural gas as lower-carbon electricity rather than a one-for-one replacement and got back a snarky response. More recently I suggested that in the absence of grid-scale energy storage that wind and solar could make up 30% of total generation and for sake of argument, I would stipulate that it could supply as much as 50% under generous assumptions regarding demand management.

    The argument I made to someone humble bragging about their 100% solar at home (grid-connected, I assumed), was if half the power was “clean and carbon free” and the remaining was “dirty and CO2 polluting”, claiming that the power any one consumer received was from the “clean” portion was disingenuous.

    The response was, “You didn’t quote and reputable source for your claim. If you are going to do that, I will claim that 100% can be supplied by wind and solar.” Well, good luck doing that, but how does one communicate with people? Slashdot may be populated with young brats, but this community represents the best one can hope for regarding people being tech savvy? This belief that you can just throw 100% on grid and hope for the best is strong, and this is pretty much what the Green New Deal version that Mr. Biden supports intends? Invoke Joanne Nova as a source contradicting this by the Australian experience? Good luck with that — she is one of those Denier-Right Wingers, don’t you know. Michael Shellenberger? He is one step from being “de-platformed.”

    • If the gas plant only works intermittently at 70% capacity, its efficiency will drop and the wear and tear will increase. In the end, the overall carbon footprint will be higher than if one runs the gas plant alone. One sees this effect in Germany: about 30% are renewables (biomass included !), the rest are mainly coal fired plants. There has been no drop at all with respect to carbon emissions. The only measurable effects have been the more than doubling of electricity costs, and several hundred billion dollars of taxpayer money thrown out the window…

      • French EDF’s gas plants had a LOT of “unplanned non productive periods” aka failures. More than before. Of course, being State owned, EDF can’t blame intermittent “renewables”. So it stays silent on those.

      • I guess what I am saying is that the Green New Deal faction isn’t anywhere ready to even comprehend John Rowe’s “natural gas play” nature of renewables being a way to augment reduced-carbon natural gas electric generation, let along understand the “inside baseball” of “heat rates” and the inefficiency of running combined-cycle plants at part load.

        I suppose I should have responded to “you don’t have a reputable reference” that no one really knows what renewable fraction the grid can tolerate — Germany’s 30% not only includes dispatchable biomass power plants, but they are grid connected to France, which at least for now, has that large fleet of nuclear plants. On the other hand, 30% is widely touted as a goal for “renewable penetration” witness my local power company’s 30 by 2030 slogan.

        My neighbor with a solar panel had a yard sign denouncing “30 by 2030”, saying anything less than 100% isn’t good enough, and now I cringe every time I see my electric bill with the new “net zero by 2050” slogan. The ideological seriousness of this borders on what the Lysenko guy did to Soviet agriculture.

        • I am a retired Engineer from a Nuclear Power Plant. One thing I learned while working there was that all of the power generated is metered, like they say above, At the Bus Bar. The electricity generated by the generator is at a much higher voltage that used anywhere on the plant, thus it goes out to the substation. There it goes through protective circuit breakers and onto the high tension voltage line. The line on the very tall four legged towers, to be transferred across the state. This is the power that the company brags about how much power they are generating.
          However the plant needs power to run the motors, to run the plant, pump the water, air conditioning cooling towers, etc. That power come back into the plant at a different voltage from the local lower voltage distribution system. Then through a meter to determine how much power is consumed. A conservative number is 12% of the name plate power. The same meter in and meter out is done on Wind turbines, and these large solar furnaces. Thus another 10 – 15 percent of Name plate power is LOST. Problem is, that with NPP’s the “house Loads” drops drastically when not running. If you are not operating you are not running four very large motors pumping millions of gallons of water a minute. With a wind turbine that 10 -15% is a constant, 24/7/365. 200 kWh is being used to run the heating, cooling pumps , computers, aircraft warning lights, communications, and computers constantly. That lowers Capacity factor from 35% they brag about down to about 20%. That means it takes FIVE, 2-MW wind turbines to generate an Average of two megawatts of power 24/7/365 not three.

          • Uzurbrain, very nice comment.

            It is like if the local supermarket would only publish their profit calculated on the income from sale and not and not deducting purchase off the goods.

          • Just like Tesla claiming higher gross margins than normal car manufacturers. Something only possible because they sell directly to the customers but ignore the costs involved with selling the cars which the other manufacturers don’t incur.

  7. IMO: I’m sure Obama made many of his ‘friends’ very wealthy, for which the quid-pro-quo was, that they make him wealthy in retirement. I figure that has worked well. (In passing, it’s the same plan as Clinton had, which has worked – so far. Seems Epstein is about to blow that one apart. This is the fall of Rome…..(sigh). Cui Bono? (always follow the money).

    • Article yesterday that people are paying up to $250k for online group chats with Obama.

  8. Will the Obama administration go down correctly in history as the most corrupt and criminal in US history or will a DemonKKKrat win in November complete the continuing cover up?
    The American public, buffeted on all sides by the propaganda and lies of the Fake News urinalists, will have one last chance to save the republic from the stampeding sheep heading down into the inferno of the Progressive “Utopia!”
    The Chi-Com 19 Virus has nearly run it’s course as we near Herd Immunity Threshold so there will be no reason to allow the major Fraud-by Mail plans to take place. By September everyone who wishes to should be able to return to normal and leave mask wearing to the infected and the care givers around them. Fauxi, Birx and Gov. Whitless should, of course, be required to wear masks 24/7 for the rest of their natural lives as they are responsible for the deaths of hundreds, if not thousands, by their panic porn and denial of effective treatments early in the course of the virus.
    Just like the virus, unreliable energy is largely a scam with enough elements of truth in it to fool the uninformed. The American public has seen trillions of dollars of their tax money wasted and their economy almost destroyed by partisan hacks who never know to quit when they’re ahead; we should demand fiscal transparency from ALL of our pols and bureaucrats and force them to give back their ill gotten gains! It wouldn’t pay off the National Debt, but it might take a nice bite out of and I can’t think of anyone who deserves more to be billed for it!

  9. It went bankrupt during Trump’s presidency therefore it’s Trump’s fault. If Hilary had been elected the taxpayers would still be investing millions to billions to keep it running.

    Remember when Candidate Biden brought that up in a speech as a reason he should be reelected?

  10. Spending money on solar and wind energy is like spending money on improving horse shoes for more work from horses. Also neither horses nor wind and solar work 24 hours a day.

  11. With enough bricks and maybe some gasoline it could be made into a memorial to George Floyd.

    • That’s a demonstration plant (a whole 1.1 MW) which has been so underwhelming that it is never mentioned in the discussions for the proposed Port Augusta CSP plant and the followup 30MW plant has been canceled

      Amusingly, Solar Reserve, the company behind the construction and operation of Crescent Dunes was the lead candidate when the proposal for the Port Augusta CSP plant was last discussed…

    • Thanks Griff – but in the end that’s just a 1.1MWe pilot as you say. So not really a full scale plant. (I’m genuinely fascinated by all this stuff so not being sarky in thanking you)
      “Since June 2018, Vast Solar has operated a 1.1 MWe pilot plant in Jemalong, New South Wales. The A$24 million pilot plant consists of five modules and three hours of storage capacity and received A$9.9 million in funding from the Australian Renewable Energy Agency (ARENA).

      “One of the key learnings from the Jemalong Pilot Plant is that CSP performance is sensitive to clouds in a non-linear way – the sunnier the better,” [Craig Wood, CEO of Vast Solar] told New Energy Update.”

      Well, who’d have thought a solar plant works better when it’s sunny!

      The idea of using something like this to provide power to a mine in the middle of nowhere in Australia makes some sense perhaps. The proof will be if they can sell one, and maybe they did – their website has 3 projects on it, this one, a 60MW PV installation also at Jemalong (is that the further development?), and Mount Isa.

      Mount Isa is interesting in that it is also part CSP at least. But it hasn’t been built yet!

      My own view is that we will eventually see small nukes for remote places. A$600m for (85% CO2 free) 50MW with VastSolar or A$1000m for 300MW from a BWRX-300, 100% CO2 free – if anyone ever builds one. We’ll see.

      • “My own view is that we will eventually see small nukes for remote places.”

        I have wondered this myself. The US Navy runs ships and submarines with nuclear.

        • Navy reactors are small in size to fit into the hull of a ship.

          The reactors on my ship hat a thermal output of 148 MWt.

          My last reactor was 1600 MWe. Smaller footprint than this solar plant.

          Nuclear has the advatage of huge economy of scale. Small modular reactors is a step backwards 50 years.

          • Kit – but… Mount Isa doesn’t need 1600MW. Arguably the UK doesn’t need a nearly 4GW nuclear plant either. It’s on the scale of ‘too big to fail’ and when it does it will be a pain. By which I mean some passing seaweed clogs an intake or something else annoying, but which cause it to trip and upset the grid. Much like the 9GW of solar at lunchtime that have gone by evening, or the 12GW of wind that drop to nothing in a few hours occasionally.

            The Rolls Royce reactors Nigel Sherratt mentions above are a similar output to the massive Magnox reactors that the UK started out with, but fit on a truck. I’d call that progress, if the price is right.

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