House Republicans have voiced concerns about the Biden administration’s energy-related spending, questioning a Department of Energy (DOE) official about how a Chinese-owned battery manufacturer was on pace to get hundreds of millions in taxpayer money before the Biden administration rescinded the money in May.
Energy Secretary Jennifer Granholm said the money would “supercharge the private sector to ensure our clean energy future is American-made.”
“Shortly after the announcement, Microvast’s association with the Chinese Communist Party became apparent,” Rep. Morgan Griffith (R-Va.) said in his opening statement at the June 21 hearing.
“According to Microvast’s own SEC [Securities and Exchange Commission] filings, the government—referring to the People’s Republic of China—‘exerts substantial influence over the manner in which we must conduct our business activities, and may intervene at any time with no notice,’” Griffith continued.
Obama Commerce Department Official Appears in Filing
Another notable name that crops up in the filing is Stefan M. Selig, who was a member of the board of Tuscan Holdings Corp., a blank check company that entered a business combination with Microvast.
Pressure Mounted Over Chinese Battery Firm
December 2022 reporting in the Washington Free Beacon helped draw attention to Microvast’s close ties to China.One big issue was already evident to the federal SEC, thanks to a 2020 law that sailed through the House and Senate with unanimous votes before being signed by Trump: the Holding Foreign Companies Accountable Act (HFCAA).
“Before Microvast received its grant from DOE, it was listed by the SEC in May of 2022 as a company not in compliance with the [HFCAA]. This law is intended to prevent companies that employ China-based auditors, as does Microvast, from obscuring their financial records from U.S. regulators,” Barrasso wrote.
Although the DOE’s October 2022 announcement spoke rather definitively of “funded projects,” using the word “will” rather than “may” or “might,” Turk told the senators in February this year that the firm was merely “selected to negotiate an award.”
“There are no taxpayer funds going to Microvast or to any of the other 20 companies [announced last year] right now,” he said.
“Companies and investors clearly believe award negotiations are a formality. They believe the Department’s award announcements are meaningful, as is evident by looking at the share prices of publicly traded companies selected for awards. Of the twenty companies selected for awards, share prices of those that were publicly traded averaged an increase of almost 14% between the day before and day of the Department’s respective award announcement,” the Wyoming lawmaker’s letter states.
“The company was selected for an award and going through contract award negotiations. No money has gone out the door. It would be inaccurate to say ‘DOE canceled a grant’ or that ‘DOE pulled back an award’ as no award has been provided,” the DOE told The Epoch Times at the time.
The decision came just a day before a May 23 House hearing probing the flow of public money to what Griffith and Rep. Cathy McMorris Rodgers (R-Wash.) characterized as “shell companies with deep ties to the Chinese Communist Party.”
As federal agencies are under increased scrutiny from a divided Congress, there have been several instances of their noncompliance with congressional requests.
The Environmental Protection Agency didn’t send a witness to a May 17 House hearing on its April vehicle tailpipe emissions proposals.
When Rep. Pat Fallon (R-Texas) asked Goffman what took priority over a House hearing, the bureaucrat dodged the question.
‘In-Depth Vetting’ Comes Late
At the June 21 hearing on Microvast, Griffith and his colleagues questioned David Howell, principal deputy director of the DOE’s Office of Manufacturing and Energy Supply Chains.The Virginian asked Howell how companies are vetted by the DOE for funding.
The DOE official said “detailed negotiations are started” over BIL grants after selections are made.
“Most of us did not understand that, because it appeared from the press statements that these people were awardees,” Griffith said.
“The in-depth vetting began the day after those announcements,” Howell said, before stating that previous “in-depth vetting” of the applicants focused on “technical capacity and capabilities of the companies.”
Griffith pressed Howell on the official’s assertion that Microvast is “a majority-U.S. owned company.”
“If they’re majority U.S.-owned ... why would they say that they could be stopped or change course because of what the government said in China?” he asked.
“Simply because Microvast’s major production operations are in China,” Howell answered.
“All of the other companies that you vetted do not have that problem?” Griffith asked.
“That is correct,” Howell responded.
Rep. Kathy Castor (D-Fla.) asked how Howell has since enhanced the process of vetting companies for awards.
The deputy director drew attention to the language on “foreign entities of concern” in the BIL, saying it was “actually the first time that the Department of Energy actually received that type of language in appropriation.”
Castor appeared to defend Microvast, calling it “a U.S. company” with an owner who is “a U.S. citizen, as far as I know.”
“I’m sure there are a lot of American companies that are doing business in China that are not arms of the Chinese Communist Party,” she said.
