On August 24, 2015, President Obama announced that the Department of Energy (DOE) will provide up to $1 billion in additional loan guarantee authority to support innovative distributed energy projects such as rooftop solar with battery storage and smart grid technologies. The loan guarantee is expected to spur innovation in clean energy technologies that are central to the Clean Power Plan (CPP).
The DOE loan guarantee aims to overcome market barriers to deploying innovative distributed energy technologies through the existing Title XVII program under the 2005 Energy Policy Act and provides guidance on financial structures it can support. The DOE’s Loan Program Office (LPO) has supported large, centralized projects with loan guarantees in the past. However, the new loan guarantee includes guidance on how distributed energy projects – which typically consist of a large number of small-scale installations – could apply for the LPO’s support.
Eligible projects must involve innovative distributed technology with installations deployed at multiple sites utilizing that technology pursuant to a master business plan. As such, the distributed small-scale installations will be considered as constituting a single project under Title XVII. Importantly, the program will support new innovative technologies only. Commercially-proven schemes, such as rooftop solar or energy efficiency upgrades, will not be eligible to participate in the program. Nor will the LPO accept applications from parties involving multiple but unrelated distributed energy projects.
The initiative is part of executive actions and private sector commitments that President Obama announced at the National Clean Energy Summit in Nevada to accelerate the transition to cleaner and more distributed energy resources.
Originally published by EnerKnol.
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