U.S. Department of Energy conditionally commits $1.85 billion to the solar industry

July 8, 2010

The U.S. Department of Energy recently made conditional commitments to provide $1.85 billion in loan guarantees to two firms in the solar industry.  

Abengoa Solar Inc., a Spanish-based company with offices in Denver, Colorado, received a conditional $1.45 billion loan guarantee to finance, construct and start-up the Solana Generating Station, a 280-megawatt concentrating solar power plant to be located seventy miles southwest of Phoenix, Arizona. 

The DOE also made a conditional commitment to Abound Solar, of Fort Collins, Colorado, for a $400 million, seven-year loan guarantee to expand Abound Solar’s capacity to manufacture thin-film cadmium telluride photovoltaic cells.

Funds for the Loan Guarantees come from the DOE’s Title 17 Innovative Technology Loan Guarantee Program, a creation of the U.S. Energy Policy Act of 2005.  Through the American Recovery and Reinvestment Act of 2009, the Loan Guarantee Program received an additional $6 billion specifically to fund renewable energy and electric power transmission projects,  

To participate in the Program, the DOE periodically issues technology-specific solicitations to the public.  Once a solicitation is issued, project sponsors have a defined amount of time to respond before the solicitation date closes.

The Loan Guarantees are structured as a series of loans distributed on a milestone-basis, whereby the sponsor must meet certain objectives to release funds during the duration of the project.  The Loan Guarantee involves a comprehensive application process that may include independent engineering reports and site visits.   

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