A federal judge yesterday approved solar manufacturer Solyndra's plan to exit bankruptcy proceedings, over the objections of lawyers for the U.S. government.

The plan would mean the government would recoup just pennies on the dollar on the approximately $528 million it pumped into the company through a controversial Department of Energy renewable energy loan guarantee program.

The plan also gives two private venture capital firms, Argonaut Private Equity and Madrone Capital Partners, control of Solyndra's tax deductions, which could be worth as much as $341 million. The government had argued during the bankruptcy proceedings that such a provision was designed to allow the companies to avoid paying taxes down the road.

As part of the plan, the two firms would obtain control of Solyndra's parent company and could claim the $341 million in deductions only if that company, which would have no assets or employees, is able to make about $1 billion in profits. While that would be a hefty financial challenge for the company post-bankruptcy, critics of the plan have said the venture capital firms would have very few restrictions on how they could use the shell of a company to make enough money to unlock those deductions.

The plan could take effect Nov. 1 unless the government appeals.

Rep. Cliff Stearns (R-Fla.), who led a high-profile House Energy and Commerce Committee probe of Solyndra, yesterday criticized the giveaway of Solyndra's tax deductions. Stearns said the plan allows the Solyndra "nightmare" to continue and adds "further insult to injury for taxpayers."

Meanwhile, just weeks before Election Day, Republican presidential candidate Mitt Romney continued to use Solyndra as a poster child for the Obama administration's green energy policies.

At last night's third and final debate of the election cycle, Romney named Solyndra as one of several companies that make up President Obama's portfolio of green energy investments.

Instead of investing in companies, Romney said, "I want to invest in research. Research is great. Providing funding to universities and think tanks -- great. But investing in companies -- absolutely not. That's the wrong way to go."

Meanwhile, DOE spokesman Damien LaVera today reiterated DOE's long-held position that all decisions on loan guarantees were made on the merits, with an eye toward protecting taxpayer funds.

"From day one, decisions made on loan applications and projects supported by loan guarantees were made on the merits after careful review by experts in the loan program," LaVera said. "Our consistent goal has been to manage these critical investments in innovative clean energy technologies in a way that manages the risk to the taxpayers."