A new analysis from the U.S. Department of Energy (DOE) highlights how the agency’s Loan Programs Office (LPO) played an integral role in launching the country’s utility-scale solar PV market.
According to an update to a 2015 report, the Obama administration’s early support for solar PV projects led to a massive expansion of large-scale solar farms. The study says the loans provided by the DOE to the first five solar projects larger than 100 MW in the U.S. helped demonstrate the technology’s success to the market and led to the private financing of an additional 45 utility-scale solar PV projects, a ten-fold increase.
The DOE notes that this latest study coincides with the dedication ceremony for the Mesquite Solar 3 project in Maricopa County, Ariz. – a project that was preceded by the nearby Mesquite Solar 1, which received a $337 million DOE loan guarantee in 2011 and paved the way for this non-DOE-funded project and dozens more like it. The Mesquite Solar 3 project will help power 14 Navy and Marine Corps installations in southern California.
“When the Obama administration began, there were zero large-scale solar PV projects in the United States. Our Loan Programs Office committed funding for the first five, and today we can say 45 more have been built with private financing, opening a clean energy market that did not exist before,” said Energy Sectary Ernest Moniz.
“Mesquite Solar 1 and 3 exemplify how the Energy Department provides crucial early financing and technical support to demonstrate cutting-edge projects at commercial scale to support new markets, work with lenders, and provide confidence to investors so the department can then step aside to let industry take over. We’re excited for the ongoing opportunity to help more innovative technologies overcome hurdles to commercial maturity.”
The DOE says that, before the LPO provided loan guarantees to the first utility-scale PV facilities, developers faced challenges securing the financing necessary to build these large projects. According to the department, the LPO helped to address this market barrier by providing more than $4.6 billion in loan guarantees in 2011.
Currently, the LPO supports a large, diverse portfolio of more than $30 billion in loans, loan guarantees, and commitments, supporting more than 30 closed and committed projects. The DOE says this portfolio is helping to advance the nation’s all-of-the-above energy strategy through projects, including the first nuclear power plant to begin construction in the U.S. in the last three decades, one of the world’s largest wind farms, several of the world’s largest solar generation and thermal energy storage systems, and more than a dozen new or retooled auto manufacturing plants across the country.