DOE Expands, Simplifies Loan Guarantees for Renewable Energy Projects
October 14, 2009
DOE announced October 7 that it will provide guarantees for up to $8 billion in loans for conventional renewable energy generation projects such as wind, solar, biomass, and geothermal power, as well as hydropower. DOE will draw on up to $750 million in American Recovery and Reinvestment Act funds to support the new loan guarantees. Past offers of loan guarantees for renewable energy generation projects have focused new or innovative technologies not in general use in the marketplace, but the new solicitation is geared toward more conventional renewable energy projects.
To speed up financing for these projects, DOE will allow proposed borrowers and project sponsors to work directly with eligible lenders to gain financing. The lenders will then apply to DOE for partial, risk-sharing loan guarantees of no more than 80% of the maximum aggregate principal and interest during a loan term. The new approach is one aspect of DOE's new Financial Institution Partnership Program, which establishes a streamlined set of standards designed to expedite DOE's underwriting process for loan guarantees. See the DOE press release, the full solicitation, and the DOE Loan Guarantee Program Web site.