Published on October 17th, 2016 | by Tina Casey0
New Solar Math From US Energy Department: 0 + 5 = 50
October 17th, 2016 by Tina Casey
The Energy Department has taken a lot of heat from certain members of Congress over the solar company Solyndra, which received a large loan guarantee from the agency only to go belly up in 2011. Well, it looks like the naysayers are not getting the last laugh. In a newly issued update on the loan program, DOE takes full credit for launching the US utility scale solar industry.
Solar Math: 0 + 5 = 50
DOE issued its first major summary of the loan program back in 2015. In an update issued in February of this year, DOE noted that there were precisely zero utility scale solar power plants in the US in 2010.
Between 2010 and 2012, the first five utility scale plants in the US came into being with the support of the DOE loan program.
The loan program’s involvement was critical to the success of these first five projects because private funders were not interested in taking on the risk of new technology.
The idea behind the federal loan guarantees was to provide private sector investors with a clear demonstration that utility scale renewable energy is both technologically feasible and economically marketable.
That bet certainly paid off. DOE’s February update listed 28 additional utility scale power plants after 2012, all financed privately.
The latest update, which came out on October 14, puts the figure at 45 additional projects for a grand total of 50.
“Monumental” Solar Buy For The US Navy
Aside from pumping more activity into the US economy, utility scale power plants are beginning to play a key role in national security.
That interest is particularly evident in the US Navy’s pursuit of clean energy. Under an agreement described as “the largest purchase of renewable energy ever made by a federal entity,” the US Navy is the customer for power generated by the newly dedicated Mesquite Solar 3 power plant in Arizona.
The 210 megawatt facility will provide about one-third of the electricity used by 14 different Navy and Marine Corps facilities in California.
Here’s Dennis McGinn, Assistant Secretary of the Navy for Energy, Installations & Environment, enthusing over the deal on the occasion of last week’s dedication ceremony:
“This ceremony marks the completion of one of the first and most monumental, renewable energy projects undertaken by the Navy. The 14 Navy and Marine Corps installations that will be receiving the power produced by Mesquite Solar 3 will be getting more than just clean, renewable power. They will be getting increased energy resiliency and security, which is crucial to maintaining our mission readiness.”
For those of you familiar with the Mesquite project, there is also a Mesquite Solar 1 array, which our sister site PlanetSave included in its list of top energy stories for 2013. Mesquite Solar 2 began construction last fall and should be completed this year.
Doubling Down On Federal Energy Loans
In publicizing the new update, DOE seems to have gone out of its way to throw the success of the loan program back at the naysayers.
DOE pitched the new update as part of the Mesquite Solar 3 dedication ceremony with this observation:
Mesquite Solar 3 is part of the three-phase Mesquite Solar Complex, which provides an ideal window into how the Department’s Loan Programs Office (LPO) helped launch the utility-scale photovoltaic (PV) solar industry in the United States.
In case that went over anybody’s head, DOE elaborates:
In 2011, LPO issued a $337 loan guarantee to Mesquite Solar 1, the first phase of the Mesquite Solar Complex. It was one of the first five PV projects larger than 100 megawatts (MW) in the United States, all of which benefited from DOE loan guarantees under the Section 1705 Program, which was created by the American Recovery and Reinvestment Act (ARRA).
Anti-solar legislators did succeed in putting a halt to the solar aspect of the loan program, but LPO survived.
Despite the pushback, LPO is making no apologies for its solar ventures. In fact, LPO is holding its efforts in the solar field up as a model for future programs.
According to DOE, the office is “working to replicate the success it had with utility-scale solar” in other sectors.
That would include other renewable energy ventures as well as energy efficiency and advanced manufacturing. For the record, the loan program also encompasses advanced fossil fuel and nuclear projects, too.
Solyndra or not, DOE’s solar success record has not come at the expense of US taxpayers. The loan program was established as a high risk, high return endeavor under the Bush Administration with the understanding that not all of the projects it backed would come to fruition.
From the get-go, the program was designed to tolerate a certain degree of failure, and things have gone according to plan.
By 2014, DOE was reporting that interest payments on its loans had already wiped out losses from Solyndra and other high profile failures including Fisker Automotive and Abound Solar.
Image: via US Department of Energy.