When you donate hundreds of thousands of dollars to re-election campaigns and push more hundreds of thousands of dollars through lobbying, you expect a little more back than the measly $95.6 million that SolarCity received in stimulus grants. The company, chaired by none other than Elon Musk, had applied for $325 million in federal aid in the same program that 'helped' Solyndra (and Tesla) and is now, according to the Wall Street Journal [5], suing the government for underpayment of green-energy subsidies. It seems SolarCity are using the M.A.D. defense, claiming that "they could lose millions more," if the government fails to provide the subsidies they asked for. As National Review details [6], SolarCity is one of the solar companies that is being investigated by the IRS after Treasury found that it "repeatedly overstated the value of its investments." So far the Treasury has paid out over $17 billion in green-energy stimulus grants and this case is not without precedent as a number of other renewable-energy firms are set to file suit.
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A look at the Department of Treasury Section 1603 data shows that SolarCity received 27 awards across 15 states amounting to $95.6 million in cash from a long-standing tax credit for renewable-energy investment turned into a direct grant in the stimulus bill. SolarCity has applied for approximately $325 million in these stimulus grants, according to the SEC filing.
There are a few things to note here.
First, ... SolarCity ... is being investigated by the IRS after Treasury found that it "repeatedly overstated the value of its investments, the SEC filings indicate." Since the dollar amount of the grant is a set percentage of the value of the project, the benefit of overstating one’s value is that it leads to more taxpayers’ cash.
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Second, the chairman of SolarCity is Elon Musk, who is also a large owner in the company. In addition to being the chairman of SolarCity, he is also CEO of the automobile company Tesla. Tesla received $465 million from the ATVM loan-guarantee program, the DOE program that gave us the Fisker scandal.
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Third, it is worth noting that Elon Musk is a generous political donor. Why does this matter? Because it’s one thing for the government to mismanage taxpayers’ money (as it may have with 1603 payments to SolarCity); it’s another when the mismanagement happens to heavily benefit some of the administration’s large donors.
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Fourth, according to the Center for Responsive Politics, SolarCity spent $535,000 in 2009 and 2010 to lobby Congress and the Department of Energy on climate legislation, theRecovery Act, “green workforce training and development,” and provisions in various legislation “relevant to solar development.”
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