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Department of Energy chief Steven Chu wasn’t kidding about accelerating the agency’s loan guarantee program. The DOE today offered Fremont, Calif.-based thin-film solar startup Solyndra a $535 million loan guarantee to help finance a new manufacturing plant for cylindrical solar panels in California. This is the first guarantee to get the green light in a much-delayed program created under the Energy Policy Act of 2005. Solyndra applied for the guarantee back in 2006.
Today’s announcement does not mean money in the bank for Solyndra just yet — the company still has to meet an equity commitment requirement for the DOE to finalize its guarantee. Still, having the feds on its side will drop many barriers to financing in today’s tight markets. Solyndra expects the guaranteed loan to provide debt financing for some 73 percent of the costs for a photovoltaic solar panel factory producing up to 500 MW per year and employing about 1,000 people. As many as 3,000 people will find work building the plant.
The guarantee represents a big vote of confidence in the venture capital-backed startup that came out of the woodwork and began making deliveries in earnest less than a year ago, as well as in cylindrical thin-film solar technology overall. The DOE said in its release this afternoon that, “Solyndra’s photovoltaic systems are designed to provide the lowest installed cost and the highest solar electricity output on commercial, industrial and institutional roof tops, which are a vast, underutilized resource for the distributed generation of clean electricity.”
Solyndra is aiming for more than just lower-cost solar: The company says economies of scale created by this expansion will eventually translate to nothing less than grid parity.