Oct. 6 (Bloomberg) -- Reed Hundt, head of the Coalition for Green Capital, said alternative-energy companies should be given a 10-year tax break on profits as a way to create jobs and stimulate innovation in clean technology.
Hundt, who was chairman of the U.S. Federal Communications Commission from 1993 to 1997, is working with the government as well as Silicon Valley venture capital and private equity firms to ensure that money is still available for clean-energy projects after the collapse of Solyndra LLC last month.
“Step one is that the Silicon Valley venture community has to stand up for the fundamental idea that success can come from failure,” Hundt said in an interview at a clean-tech conference yesterday in Redwood City, California. “And this is a Congress that hates taxes, so how about eliminating all income tax on the sale of clean-energy goods or services for the next decade.”
Solyndra, a solar-panel maker in Fremont, California, fired 1,100 workers and filed for bankruptcy on Sept. 6, two years after receiving a $535 million loan guarantee from the U.S. Department of Energy. The company’s downfall doesn’t change the need for the production of biofuels, solar power and technology that helps reduce energy consumption, Hundt said.
In addition to making proposals to Congress, Hundt’s Washington-based nonprofit is working with individual states to make capital more available. In June, Connecticut adopted a measure for a so-called green bank, designed to provide low-cost financing for energy-efficiency projects. The project will be funded by a surcharge on residential and commercial electric bills amounting to about $30 million a year.
Legislators in Oregon, Michigan, Pennsylvania, Ohio and New York have reached out to Hundt’s coalition to do something similar, he said.
Venture funding of clean-tech companies fell 4.5 percent in the first half of this year to $2.17 billion from $2.27 billion a year earlier, according to the National Venture Capital Association. Still, the $1.23 billion invested in the first quarter marked the second-highest period ever, after the second quarter of 2010, the NVCA said.
That won’t slow down just because Solyndra is being scrutinized, said Jim Fulton, co-chair of the clean energy and technologies group at law firm Cooley LLP in Palo Alto, California, which sponsored the conference. Congressional Republicans are leading an investigation into Solyndra’s loan guarantee, and the company faces a probe by the FBI.
“Solyndra will not be a defining moment in clean-tech history,” Fulton said in an interview. “There is an alternative universe in Washington, D.C., and politics that is blowing this out of proportion.”
Hundt, 63, also works with the Aspen Institute, which describes itself as a “venue for discussing and acting on critical issues,” and worked on President Barack Obama’s transition team from 2008 to 2009. He serves on the board of Intel Corp., the world’s biggest semiconductor company, and Serious Energy Inc., formerly Serious Materials, which provides software for building owners and developers.
--Editors: Jillian Ward, Lisa Rapaport
To contact the reporter on this story: Ari Levy in San Francisco at Alevy5@bloomberg.net
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