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Published on May 9th, 2013 | by Guest Contributor

9

DOE Renewable Energy Loan Program Has Created 20,000 Jobs (Way Beyond Solyndra)

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May 9th, 2013 by
 
This article was originally published on Climate Progress.
By Jeff Spross

Solar panel installation via Shutterstock

Image Credit: Solar panel installation via Shutterstock

The Department of Energy’s Loan Guarantee Program was started in 2005 under the Bush Administration, but ramped up thanks to the 2009 stimulus passed by President Obama and the Democrats. It has gotten a bad rap ever since the high-profile failure of Solyndra, one of the solar tech companies the program invested in.

But, of course, a certain amount of failures and losses just come with the territory of investments in new technology. And The Atlantic Wire reports that the latest numbers reveal the program’s successfully shepherded 28 companies with various renewable energy projects, while creating over 20,000 jobs. Throw in the Advanced Technology Vehicles Manufacturing loan program, and the total created jobs come to around 60,000.

The purpose of the program, which is no longer handing out new loans, was to help companies cross the “valley of death” — the point when a company’s debt is at a maximum, because it’s already spent money investing in capacity and research and development, but hasn’t yet seen enough success in the market to have the revenue to begin paying those loans back. The government guarantee then encourages private investors, who must ultimately make up at least 20 percent of the investment pool under the programs rules, to take the risk of backing the company. The government’s own contributions are also structured as a loan, meant to be paid back over time.

As The Atlantic Wire notes, that last point is especially important to remember. The loan program has paid out $26 billion in total, resulting in a less-than-impressive ratio of $1.2 million per job created. But that’s with the government’s expenditures all out the door, and the returns from the companies yet to come in:

The loan guarantee is often considered a cost, which it isn’t. Some programs — like that wind farm out in Hawaii, are already repaying the loan, though it’s not clear how much. Others, like NextEra Energy, never received the full loan amount. We are currently at the high point of the dollars-for-jobs-created ratio. Given the nature of the program, the amount the government is out is reduced gradually over time.

The calculation is only temporarily that 0.8 jobs were created for every $1 million spent. It is nearly as fair to say that the ratio is 20,000-to-zero.

Obviously, the 20,000 jobs for $0 is an almost-certainly unattainable ideal, but that’s the direction in which the ratio is headed. And for the curious, here’s a map The Atlantic Wire compiled of the various projects and their numbers:

According to the Solar Energy Industries Association, the loan program has already brought one utility-scale solar project to operation, with ten more in the process of construction, in states such as Michigan, Kentucky, and Alabama. When they’re all completed, the eleven projects will supply over 2,700 megawatts — enough power to run roughly half a million homes. Another one of the loan program’s projects is expected to install 750 megawatts of solar arrays on commercial rooftops, across 28 different states.

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  • Jim

    solar power will have to come to an end .

    • Ross

      Sorry I’ve bad news for you. The Sun has another 5 billion years of fusionable reserves and its luminosity will increase as it ages.

  • James

    JIM you make a very good point the truth will set you free.

  • Fred

    There are very good media news reports on off grid stand alone system which is getting a good run on the air waves with the media. However the media have been reporting failures of grid rooftop solar power, sending many country’s bankrupt.

  • http://www.facebook.com/people/Mark-Tracy/1064316217 Mark Tracy

    I don’t expect to hear much from our corporate media on this positive story. Most of the media seem to have adopted the talking-points of those who like to denigrate alternative energy.

    • James

      No your wrong on that the media has covered more than enough renewable energy stories however what the media tends to focus on these days is evidence that these things are so. What is concerning the media this year there has been no evidence of reduction of oil burning furnaces in the average American home in fact oil burning has increased this year. The evidence of wind and solar has not been there to provide heating for the population of the American homes and factories. The media only take stories with evidence Put forth, that every American home, office building and factory can be heated on renewable energy without their dependence on foreign oil. No one has come forth and put this claim as yet.

    • JIM

      I heard this site is like the commonest party from Face book and Twitter posting yesterday, this site don’t agree with a posting they delete it out?…..??????…

      Sound like the Cold War is on renewable energy lies, and when questions are asked about how the American homes were going to be heated during winter with renewable energy there response was delete it . Bible says the truth will set you free.

  • jburt56

    Worldwide the total average number of jobs in sustainable energy will probably be around 10 million.

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