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CERAWeek: DOE Sec. Granholm says $40 billion in clean energy loans ready to roll

03 March 2021 Karin Rives

Barely a week into her new job as secretary of the US Department of Energy (DOE), former Michigan Governor Jennifer Granholm announced 3 March that she has kicked her agency's $40-billion loan authority back into full gear and picked a high-profile clean energy trailbreaker to lead the effort.

Jigar Shah, who founded SunEdison in the early 2000s and invented the purchase power agreement model that is now the backbone of most US solar energy projects, was appointed to run the DOE flagship loan program. He has been tasked with funneling billions this year alone into the Biden administration's ambitious energy transition plans.

"He's has written the playbook on how to drive the market toward clean energy solutions," Granholm told the CERAWeek by IHS energy conference. "He's going to help us put together an indominable portfolio of investments for American taxpayers so we're ready to invest in advanced vehicles, and carbon capture, and advance reactors and so much more. The possibilities are endless."

Shah also led the Carbon War Room, the initiative founded by Richard Branson and Virgin United to spur new low-carbon solutions businesses, and most recently served as co-founder and president at Generate Capital, where he focused on helping clean energy access financing.

The DOE loan office chief said in a tweet Wednesday that he will help the agency be a "safe and inviting place for innovation to be deployed at scale."

$500 million in returns for taxpayers

The DOE loan office has been credited for backing the first five US utility-scale solar projects, including the 392-megawatt Ivanpah facility in California, and for funding emerging technology companies like Tesla. But is also came under fire for offering $535 million in loan guarantees in 2009 to solar panel manufacturer Solyndra that went bankrupt two years later, leading to investigations and hearings in the US Congress.

Those losses have long since been recouped. Granholm said that taxpayers have so far earned $500 million on the $30 billion in loan guarantees the DOE loan office has given out since it began operating in 2006.

"Our loan authority has as helped some of America's bravest entrepreneurs get their best ideas off the ground and to flourish into what they are today," Granholm said. "I'm ready to rev those engines back up."

The program laid mostly dormant under President Trump, offering funding for just a few nuclear energy projects over the past four years. Trump at one point sought to close down the office.

Geothermal energy projects coming up

In addition to loan guarantees, the Energy Department last month also issued a call for $100 million in research and development grants for start-up projects funded by the agency's popular Advanced Research Projects Agency-Energy program. On its list of projects: sea-weed farming drones that make biofuel.

The agency also recently awarded $46 million to jumpstart geothermal energy projects in the United States.

"It's an old technology, and it's a new technology and we're going to pursue it," Granholm said. "These are cutting-edge project that will have the potential to power millions of American homes."

The next step, Shah wrote on Twitter, will be to get projects off the ground.

"We will need your help to make sure that we people apply for these funds and we all work collaboratively to help communities and workers benefit from this transition," he wrote.

Granholm emphasized that the Biden administration only has four years guaranteed to work with, and that it's in a race to get as many policies and programs implemented as possible to meet the president's goals. Biden has called for a fully decarbonized power grid by 2035 and a net-zero emissions economy by 2050, which aligns with the goals set by the 2015 Paris climate treaty.

"Four years … that's less than 1,000 days if you exclude weekends," Granholm said, adding, "But we're going to work 24-7."

Posted 03 March 2021 by Karin Rives, Senior Journalist, IHS Markit

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