Big DOE Loan Guarantees For California Solar

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Editor’s Note: A quick update to this story – First Solar, besides selling Solar Ranch One, also sold off the Desert Sunlight facility to NextEra Energy.

On the controversial program‘s last day of existence, the U.S. Department of Energy (DOE) finalized loan guarantees to build two huge solar-power plants in California – a 550-megawatt (MW) plant in eastern Riverside County and a 230-MW plant in Antelope Valley, in the northern reaches of Los Angeles County.

The guarantees had both been pursued be First Solar, but before the DOE announcement news broke that the company had sold Antelope Valley Solar Ranch One to the big electric utility Exelon. Exelon didn’t divulge a purchase price, but said it expects to make a “total investment of up to $1.36 billion” in the project, which First Solar will build, operate and maintain.

loan guarantees, First Solar

image via First Solar

The federal government is guaranteeing $646 million in financing for the Antelope Valley project. The Riverside County project, called Desert Sunlight, is getting a larger guarantee, at $1.46 billion, but that is a partial guarantee and will be funded by a group of investors led by Goldman Sachs Lending Partners, the DOE said. In these situations, the government is typically on the hook for around 80 percent of the loan’s value should the project collapse.

For the past week, the fate of First Solar’s conditionally approved loans – there had been three in all – had been the subject of intense speculation after the company revealed it was told its application to build the Topaz solar plant in San Luis Obispo County would not be finalized because “there was insufficient time to process all requirements” before the loan program had to wrap up business at the end of the fiscal year.

Pete Danko is a writer and editor based in Portland, Oregon. His work has appeared in Breaking Energy, National Geographic's Energy Blog, The New York Times, San Francisco Chronicle and elsewhere.