When the U.S. Department of Energy announced in March a whopping $535 million loan guarantee to thin-film solar developer Solyndra, it sparked the hope that the government would soon come to a decision about offering financial assistance to greentech companies. Some companies had requested the help as far back as three years ago.
Beacon Power and Nordic Windpower became the second and third companies to receive DOE loan guarantees since Energy Secretary Steve Chu vowed to speed up the review process and make decisions quickly.
The DOE first created a loan guarantee program to support clean energy development after Congress passed the Energy Policy Act of 2005. After an initial selection process, it picked 16 finalists and asked each of them to submit a full application in 2007. Solyndra and Beacon were on the list.
The American Recovery and Reinvestment Act of 2009, passed in February this year, created a new loan guarantee program. Many solar and other renewable power companies plan to apply to help finance their multimillion-dollar power plants and other projects.
The government has come to be considered a rich source of financial aid because of the credit crunch. The loan guarantees assure lenders that the U.S. government would repay the loans, even if the companies can't.
Beacon Power, based in Tyngsboro, Mass., would receive $43 million in loan guarantees, which enables the company to secure money from the Federal Financing Bank run by the U.S. Department of Treasury.
The federal loan would make up 62.5 percent of the $69 million project cost, Beacon said.
The company plans to use the money to build a 20-megawatt flywheel energy storage plant in Stephentown, N.Y., Beacon said. The plant would store power when electricity supply is abundant, and discharge it when needed by local utilities to manage the load of a grid.
Nordic Windpower is set to receive $16 million in loan guarantee to expand a wind turbine assembly factory in Pocatello, Idaho. The Federal Financing Bank also would provide the loan.
The Berkeley Calif.-based company has developed a 1-megawatt wind turbine that features two instead of three blades to lighten its weight, the company said. Nordic claims that its turbines would cost 10 percent less to make, install and operate than its competitors' products.
Other companies that are waiting the DOE to decide on their loan guarantee applications include BrightSource Energy, a solar thermal power developer in Oakland, Calif.
BrightSource applied for federal financing to fund a 100-megawatt power plant and a 200-megawatt power plant in Ivanpah, Calif. The company, which has declined to disclose how much it's seeking, would sell power from those projects to San Francisco-based Pacific Gas and Electric.
BrightSource has contracts to deliver power not only to PG&E but also the Southern California Edison. The power project developer plans to build 2.6 gigawatts of solar thermal power farms to sell power to the two utilities (see BrightSource, PG&E Sign 1.31GW Deal in California).
Image via Nordic Windpower.