The controversial fall of Solyndra is causing problems for others in the solar industry. A Monday report from Reuters details the woes that SolarCity is facing due to fallout from the Solyndra deal.


“The Department of Energy informed SolarCity of its inability to close the loan 48 hours ago, blaming increased paperwork resulting from a Congressional investigation into the DOE's $535 million loan guarantee awarded to bankrupt solar company Solyndra, SolarCity said in a letter to the Republican lawmakers heading the probe.”


While this shouldn’t have any affect on SolarCity’s partnership with Walmart to bring solar power to up to 60 new stores in California, it will have an impact on plans to bring more solar power to the military via the SolarStrong project.


SolarStrong would have provided rooftop-mounted solar system to up to 160,000 military family homes. In order to achieve this aggressive goal, SolarCity was relying, in part, on a $275 million DOE loan guarantee. Without that guarantee the project is unlikely to be completed, at least at its original level.


Unfortunately the lack of a loan guarantee isn’t just affecting the military families that could be reducing their monthly electric bills thanks to the solar arrays, it is also preventing the creation of new green jobs. SolarCity CEO Lyndon Rive is quoted in the Reuters article saying that the project could create thousands of job years. This is a certainly a bad time to be throwing a wrench into a solid job-creating project.

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