Obama admin offers $4B in loan guarantees for renewables, efficiency
The Department of Energy is making up to $4 billion in loan support available to foster technology and equipment for the grid, transportation and housing technologies that would curb emissions and complement President Obama’s climate initiative.
The funding stems from $2.5 billion in appropriations bills and the availability of $170 million of appropriated funds to pay a portion of the applicants’ “credit subsidy fees,” funds that reflect the risk a project will default.
“As the president emphasized in his Climate Action Plan, it is critical that we take an all-of-the-above approach to energy in order to cut carbon pollution, help address the effects of climate change and protect our children’s future,” Energy Secretary Ernest Moniz said in a statement.
Moniz — who has repeatedly touted the program’s success in supporting endeavors like California’s Ivanpah solar power plant and electric carmaker Tesla Motors Inc. — said DOE is already helping launch or jump-start entire domestic industries from utility-scale wind and solar to nuclear and lower-carbon fossil energy.
“Today’s announcement will help build on and accelerate that success,” Moniz said.
The solicitation is aimed at supporting “catalytic, replicable, and market-ready” projects that avoid, reduce or sequester greenhouse gases and employ new or significantly improved technology. The document outlines five key technology areas of interest: integration of renewable sources to the grid and storage of electricity, drop-in biofuels, waste-to-energy technology, enhancements to existing facilities, and improved efficiency in residential or commercial buildings.
Potential candidates could include microgrids, energy storage projects, bio-refineries and “distributed” energy systems that incorporate storage, demand response and efficiency. The solicitation also points to projects that tap into waste from landfills, forestry and crop waste; improve existing dams and windmills; and tap into unused energy.
Applicants must submit materials — including a description of the project and timeline for regulatory approvals — in five rolling dates beginning Oct. 1 and ending Dec. 2, 2015. Projects that move on to a more thorough second-phase review, which will examine creditworthiness, legal aspects and engineering, must submit applications on five rolling dates beginning Jan. 14, 2015, through March 2016.
The Obama administration has stepped up its loan guarantee authority this year. The agency is separately accepting applications for an $8 billion advanced fossil energy solicitation released in December and $16 billion for advanced technology vehicle manufacturing. The agency also closed a $6.5 billion loan guarantee earlier this year to support Southern Co.’s construction of two nuclear reactors in Georgia (E&ENews PM, Feb. 19).
The new funding announcement also arrives the same week DOE announced a $150 million conditional loan guarantee for the Cape Wind project, pushing forward the first commercial offshore wind farm (Greenwire, July 1).
The uptick in activity signals a change for the Obama administration, which has moved forward cautiously after several of its recipients went bankrupt including solar panel maker Solyndra.
Moniz earlier this year foreshadowed the agency would aggressively finalize loan guarantee commitments by the year’s end for nuclear, fossil, renewable and energy efficiency projects (E&ENews PM, April 23).
“As we go forward with the loan program, as aggressively as we can this year, across the board, we’ll continue to try to be focused on the early mover deployments with the idea that some of those … will get picked up by the private sector,” Moniz said. “We don’t have the resources, frankly, or the interest of being the ones that make the entire market.”
Green groups had protested DOE’s inclusion of waste-to-energy technologies, particularly those that involve garbage incineration, as one of the program’s priority areas. In comments, they said that burning garbage releases both toxic air pollutants and greenhouse gas emissions (Greenwire, May 28).