U.S. DOE faces Sept. 30 deadline for finally approving US$9B in loan guarantees for renewable power projects amid doubts following solar-panel maker Solyndra's bankruptcy; projects awaiting word mostly have proven technologies, analyst says
September 16, 2011
– The U.S. Dept. of Energy (DOE) is facing a Sept. 30 deadline to give the final word on loan guarantees totaling over US$9 billon, while feeling the pressure following the bankruptcy of solar-panel maker Solyndra LLC, reported CNNMoney on Sept. 16.
The 14 companies awaiting word on the loan guarantees are “sweating right now” over whether or not they will receive a loan guarantee, said Dan Ries, a renewable energy analyst at New York-based investment bank Collins Stewart.
The companies include those building advanced ethanol facilities, like Spain’s Abengoa Bioenergia SA; those planning solar power projects, such as SunPower Corp. of California; a geothermal proposal from Nevada-based Ormat Technologies Inc.; and wind energy ventures, CNNMoney reported.
The DOE has listed the details about these companies on its website.
These remaining projects represent less risky investments than those already given loan guarantees under the DOE program, which has awarded over $10 billion for 18 companies. This included Fremont, California-based Solyndra, which received backing for a $535 million loan.
Many of the remaining projects have “technologies that have been proven to be stable and viable in years of deployment,” such as those supporting wind and solar generation, said Ries, reported CNNMoney.
However, the Solyndra situation has created some doubts as to whether DOE should award the remaining loan guarantees. It might be better to put that money towards deficit reduction, said Rep. Cliff Sterns, a Republican from Florida, during a congressional hearing on Wednesday.
The DOE only pays the actual money for a loan under the program if a company defaults, which is likely to occur for 10% of the total awarded, according to DOE estimates.
Congress has put aside $2.4 billion to back the more than $20 billion in renewable energy loan guarantees, CNNMoney reported.
The primary source of this article is CNNMoney, New York, New York, on Sept. 16, 2011.