A large solar power panel farm is set to rise near Las Vegas, Nevada with the help of a federal loan guarantee program. The Department of Energy on Thursday announced a $45.6M conditional loan guarantee offer to solar developer Fotowatio Renewable Ventures to build a 20 MW solar photovoltaic project.
The project is one of the last batch of applications for the DOE’s renewable energy loan guarantee program, which is set to sunset on Sept. 30 of this year. Last month, the DOE’s loan guarantee program chief Jonathan Silver said his staff had narrowed down a list of projects that were still eligible for loan guarantees and also notified applicants whose projects weren’t good enough or far enough along in the process to be in the running for the loan guarantees.
The loan guarantee program sprung to life as part of the 2009 stimulus package that aimed to boost job creation and clean power generation. Through the program, the government is committed to pay off the loans if the borrowers can’t.
The loan guarantee for Fotowatio’s project is unlike many other renewable energy projects that have received loan guarantee offers in one key way: Fotowatio is set to get the loan guarantee through the Financial Institution Partnership Program (FIPP), in which the government backs a loan offered by a private financial institution. John Hancock Life Insurance is the lender and applicant for this loan guarantee. FIPP projects employ mature technologies that have been deployed for at least several years, the DOE said.
In contrast, loan guarantees such as the $1.6 billion for BrightSource Energy’s Ivanpah project in California and the $1.45 billion for Abengoa Solar’s Solana project in Arizona came from another section of the loan guarantee program that focuses on new technologies. For these projects, the government is providing the loans as well through the Federal Financing Bank because private lenders generally shy away from funding technologies that haven’t proven they can perform well for decades as promised.
Fotowatio plans to use silicon solar panels that will sit on single-axis trackers, which help to boost electricity production by rotating the panels to face the sun directly as the sun moves across the horizon. Power from the project will go to Nevada utility NV Energy.
Fotowatio has been actively developing solar power projects throughout the country and elsewhere in the world. In January, it announced it had signed contracts to sell 120 MW of solar power to utility Southern California Edison. Fotowatio also recently lined up money to build a 30 MW project in Austin.
Nevada has been a major beneficiary of the loan guarantee program. The DOE announced a $737 million conditional loan guarantee for a 110 MW solar power plant by SolarReserve last month. The first loan guarantee for a transmission project went to One Nevada Transmission, which is being built by the Great Basin Transmission and NV Energy. The developers received a loan guarantee for $343 million. Nevada’s grand plan is to build many renewable energy power plants and the necessary transmission lines so that it can sell power to California, which requires its utilities to get 33 percent of the electricity from renewable sources by 2020.
Photo courtesy of Fotowatio Renewable Ventures