DOE Wrapping Up Renewable-Energy Project Loan Guarantee Program
May 10 2011 - 8:45PM
Dow Jones News
The U.S. Department of Energy said Tuesday that it has stopped
accepting applications for loan guarantees to help finance new
solar, wind or other renewable energy facilities and suggested
there would be winners and losers among companies that have
applications pending.
The loan guarantee program for renewable energy generation
projects, called "Section 1705," after the portion of the 2009
Recovery Act that supports it, expires Sept. 30 and only projects
that can start construction and close their loan guarantees by that
date will be considered for a guarantee, Jonathan Silver, the head
of the agency's loan programs office, wrote in a blog post on the
DOE web site.
The agency has issued roughly $1.6 billion in loan guarantees
for 19 renewable energy projects to date. Loan guarantees for
roughly $800 million in remaining funds will be issued to companies
that have already applied, whose applications are "farthest along
in the process," and whose projects are most likely to meet the
Sept. 30 construction deadline, Silver wrote.
"Not all these projects will succeed by September 30th," he
wrote.
The DOE placed another group of applications "on hold" after
determining that the projects were unlikely to meet the Sept. 30
deadline, Silver wrote. He added that if the program received more
funding in the future, those applications could be revived.
The DOE notified companies on Tuesday whether their applications
would proceed or not, Silver wrote.
Tempe, Ariz.-based First Solar Inc. (FSLR) said pending
applications it filed for solar farms it is developing were moving
forward. The company declined to provide details about its
applications.
It was unclear which applications were moving forward and which
were put on hold.
SunPower Corp. (SPWRA, SPWRB), which obtained a $1.2 billion
conditional loan guarantee for a 250-MW solar farm it plans to
build in California, has not applied for any additional loan
guarantees, said SunPower spokeswoman Helen Kendrick.
First Solar Inc. (FSLR) received a $967 million conditional loan
guarantee for a 395-megawatt solar farm it plans to build in
Arizona. First Solar's project finance team met with DOE staff
Tuesday to move the company's pending applications forward, First
Solar spokesman Alan Bernheimer said. He added that the company
hadn't received any notification from the DOE, saying that any
application had been put on hold.
Telephone calls to the DOE were not returned.
In a separate announcement, the DOE said Tuesday that it awarded
a $90.6 million conditional loan guarantee to Goldman Sachs Group
Inc. (GS) unit Cogentrix to build a 30-megawatt solar farm in
Colorado.
U.S. solar-panel maker Ascent Solar Technologies Inc. (ASTI),
which had applied for a government loan guarantee--under a
different DOE program--to expand a factory, said last month that it
withdrew that application.
"Timing and funding requirements under the loan guarantee
program did not correlate with our revised business plan," Ascent
wrote in a report filed April 28 with the U.S. Securities and
Exchange Commission.
-By Cassandra Sweet, Dow Jones Newswires; 415-439-6468;
cassandra.sweet@dowjones.com
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