DoE Closes $4.7 Billion in Loan Guarantees for Solar Power

DoE said that it closed loan guarantees and related deals worth $4.7 billion for solar projects, including power plants backed by First Solar Inc. (NASDAQ: FSLR). The DoE closed loan guarantees for three large-solar power plants and one large rooftop solar project hours before the loan-guarantee program was set to expire.

The DoE said that it has now issued loans and loan guarantees for $40 billion in projects related to clean-energy. A number of loan guarantees are still in the pipeline and will now compete for a much smaller pool of funding.

With the closing of the loan guarantees on Friday, the DoE will be able to access funds from 2009 economic stimulus package. The government is facing increasing pressure in selecting the remaining guarantees after Solyndra LLC, a solar start-up that obtained $535 million loan guarantee, filed for bankruptcy.

Among the projects that received loan guarantees on Friday included two solar-power plants backed by First Solar. Following the receipt of the loan guarantee, the company announced that it will sell the two power plants to new owners. The company will, build and manage the plants. The company’s 230-megawatt Antelope Valley solar plant has been acquired by Exelon Corporation (NYSE: EXC), while its 550-megawatt Desert Sunlight project will be sold to NextEra Energy Inc. (NYSE: NEE).

The DoE also closed a loan guarantee under which it will partly fund a large commercial rooftop solar-panel project. The project is being developed by NRG Energy Inc. (NYSE: NRG) and ProLogis Inc. and will be the largest rooftop solar deployment in U.S. history. The loans and loan guarantee for the project will cover almost half of a $2.6 billion plan to install solar panels on rooftops of ProLogis warehouses in 28 states. The DoE also guaranteed a $1.2 billion loan for SunPower Corp.’s (NASDAQ: SPWRA) solar power plant located in San Luis Obispo County, California.

Loan applications reviewed by the Department have undergone many months of due diligence and often receive bipartisan support. DOE evaluates the technical aspects of an application to make sure the technology is feasible, works to ensure that projects can be built to scale, does extensive market analysis to ensure there is a place in the market for the product, and evaluates the finances of the project to ensure it is commercially viable. We are confident that supporting these projects will help American companies compete in the global clean energy market.

The Department of Energy’s Loan Programs Office (LPO) administers three separate programs: the Title XVII Section 1703 and Section 1705 loan guarantee programs, and the Advanced Technology Vehicle Manufacturing (ATVM) loan program. The Title XVII loan guarantee programs support the deployment of commercial technologies along with innovative technologies that avoid, reduce, or sequester greenhouse gas emissions, while the ATVM loan program supports the development of advanced vehicle technologies. To date, the Department has issued loans, loan guarantees or offered conditional commitments for loan guarantees totaling nearly $40 billion to support more than 40 clean energy projects across the United States, including several of the world’s largest concentrated solar power generation facilities, three geothermal energy projects and the world’s largest wind farm.