Yesterday came more news in the solar sector regarding a loan guarantee for another giant solar project. NRG Energy, Inc. (NYSE: NRG) announced this week that its 290-megawatt Agua Caliente solar project has received an offer of a conditional commitment for a loan guarantee of up to $967 million from the U.S. Department of Energy. There are other projects as well getting guarantees, and we can’t help but wonder how many projects will get backing this year.
NRG’s acquisition of the Yuma County, Arizona project from First Solar Inc. (NASDAQ: FSLR) was announced last month, began in 2010, and is expected to be complete by 2014. The press release says that it will create up to 400 construction jobs. We won’t approach this from the aspect that the only goal is to create 400 jobs, otherwise we’d have to point out that $967 million for 400 jobs comes to 2.4175 million per job. The real goal is cutting the nation’s fossil fuel dependence and carbon footprint with renewable energy sources.
Separately, the U.S. Department of Energy and the Department of Energy announced four loan guarantees worth $645 million.
The first project is a venture between Darling International Inc. (NYSE: DAR) and Valero Energy Corporation (NYSE: VLO) called Diamond Green Diesel, LLC and the USDA/DOE has formally offered a conditional commitment for a $241 million loan guarantee for the proposed joint venture project with to build a renewable diesel facility. If finalized, the loan guarantee will support the construction of a facility capable of producing over 9,300 barrels/day or 137 million gallons per year of renewable diesel on a site adjacent to Valero’s St. Charles refinery near Norco, Louisiana.
The other pacts were awarded to Coskata, Ineos BIO, and Enerkem cellulosic ethanol projects. We will be watching for more and more DOE and USDA deals as more announcements are expected this year. Many solar, ethanol, and other renewable energy companies are looking for more help.
JON C. OGG