Federal

Incentives/Policies for Renewable Energy

U.S. Department of Energy - Loan Guarantee Program

Last DSIRE Review: 08/18/2010

Program Overview:

State:	Federal
Incentive Type:	Federal Loan Program
Eligible Efficiency Technologies:	Yes; specific technologies not identified
Eligible Renewable/Other Technologies:	Solar Thermal Electric, Solar Thermal Process Heat, Photovoltaics, Wind, Hydroelectric, Geothermal Electric, Fuel Cells, Daylighting, Tidal Energy, Wave Energy, Ocean Thermal, Biodiesel
Applicable Sectors:	Commercial, Industrial, Nonprofit, Schools, Local Government, State Government, Agricultural, Institutional, Any non-federal entity, Manufacturing Facilities
Amount:	Varies. Program focuses on projects with total project costs over $25 million.
Maximum Incentive:	Not specified.
Terms:	Full repayment is required over a period not to exceed the lesser of 30 years or 90% of the projected useful life of the physical asset to be financed
Web Site:	http://www.lgprogram.energy.gov

Authority 1: 42 USC § 16511 et seq.
Authority 2: 10 CFR 609

Summary:

Innovative Technology Loan Guarantee Program:
Title XVII of the federal Energy Policy Act of 2005 (EPAct 2005) authorized the U.S. Department of Energy (DOE) to issue loan guarantees for projects that "avoid, reduce or sequester air pollutants or anthropogenic emissions of greenhouse gases; and employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time the guarantee is issued." The loan guarantee program has been authorized to offer more than $10 billion in loan guarantees for energy efficiency, renewable energy and advanced transmission and distribution projects.

DOE actively promotes projects in three categories: (1) manufacturing projects, (2) stand-alone projects, and (3) large-scale integration projects that may combine multiple eligible renewable energy, energy efficiency and transmission technologies in accordance with a staged development scheme. Under the original authorization, loan guarantees were intended to encourage early commercial use of new or significantly improved technologies in energy projects. The loan guarantee program generally does not support research and development projects.

In July 2009, the U.S. DOE issued a solicitation for projects that employ innovative energy efficiency, renewable energy, and advanced transmission and distribution technologies. Proposed projects must fit within the criteria for "New or Significantly Improved Technologies" as defined in 10 CFR 609. The solicitation provides for a total of $8.5 billion in funding. The due date for Part I applications is October 5, 2010. The Part II application deadline is December 31, 2010.

Temporary Loan Guarantee Program:
The American Recovery and Reinvestment Act of 2009 (ARRA) (H.R. 1), enacted in February 2009, extended the authority of the DOE to issue loan guarantees and appropriated $6 billion for this program. This total was later trimmed to $2.5 billion. Under this act, the DOE may enter into guarantees until September 30, 2011. The act amended EPAct 2005 by adding a new section defining eligible technologies for new loan guarantees. Eligible projects include renewable energy projects that generate electricity or thermal energy and facilities that manufacture related components, electric power transmission systems, and innovative biofuels projects. Funding for biofuels projects is limited to $500 million. Davis-Bacon wage requirements apply to any project receiving a loan guarantee.

Contact:

Public Information - DOE
U.S. Department of Energy
1000 Independence Avenue, SW
Washington , DC 20585-0121
Phone: (202) 586-8336
E-Mail: LGProgram@hq.doe.gov
Web Site: http://www.lgprogram.energy.gov

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