Watchdog: Accountability

DOE hid green energy company Ecotality's financial ills from IG

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Department of Energy officials hid from investigators information about financial and performance failures of a company that got $135 million in government-backed loans.

Concealed were details of electric vehicle company Ecotality's inability to fulfill the terms of green energy loans it received under President Obama's economic stimulus program, according to the DOE inspector general.

The officials later claimed they didn't intentionally withhold the information during a July 2013 IG audit of their management of the loans.

"We found that the department had not fully disclosed known concerns regarding Ecotality's ability to meet its EV (electric vehicle) project obligations to the Office of Inspector General prior to completion of our previous audit," the IG report said.

Ecotality’s financial troubles prevented it from meeting its obligation to install EV chargers and ultimately led to the company’s September filing for bankruptcy.

Though DOE stopped payment on a $100 million portion of the award to Ecotality, the department has continued issuing checks under a 2011 $26 million award to the firm to test electric vehicles.

DOE officials argued that continuing the payments would “protect the value of federal investments that were underway” and that Ecotality assured the department the project wasn't affected by its financial difficulties, according to the report.

The IG was less confident.

“We are concerned that the department had not formally reviewed and documented its determination on Ecotality’s ability to comply with its 2011 award requirements,” the report said. “We believe that the project objectives could still be in jeopardy.”

When officials became aware Ecotality was in financial trouble and unlikely to meet its obligations by September, DOE told the company to submit a plan to return to schedule.

In July, about a month after sending the notification, DOE told the IG’s auditors that previous modifications made Ecotality’s goals achievable.

The DOE received Ecotality’s corrective plan, but hadn't approved it when the company disclosed that it had financial issues.

One major change in the company’s project plan was to lower data collection from charging stations from 16 months to three months. Some of its charging stations cost nearly three times as much as the original budgeted cost.

About 1,000 commercial charger units remained to be installed in July, though the company had earlier said only 32 would need to be installed by August.

All but $2.5 million of the $100 million award had been paid to Ecotality as of August, when the DOE suspended the payments.

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Ethan Barton

Special to Washington Examiner
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