Billion dollar injection: Obama shepherding new era of clean energy
President Obama's been busy over the past couple days. In addition to giving the keynote at the National Clean Energy Summit in Las Vegas -- where he announced a robust set of executive actions and private sector commitments to advance the country's transition to cleaner sources of energy and cut energy waste -- he has blessed more than a billion dollars in initiatives to advance innovative clean energy technologies.
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President Obama giving the keynote at the National Clean Energy Summit in Las Vegas. Credit: Barbara Lundin |
As part of the President's Clean Power Plan, the Department of Energy's (DOE) Loan Programs Office (LPO) is making up to one billion dollars in loan guarantees available to support commercial-scale distributed energy projects, such as rooftop solar with storage and smart grid technology. In addition, through the Advanced Research Projects Agency–Energy (ARPA-E), DOE is awarding $24 million in funding for 11 high-performance solar power projects that could lower the cost and improve the performance of solar photovoltaic (PV) power systems. Together, these initiatives will spur innovation, ensure grid reliability and help ensure America's low-carbon energy future.
"The announcements made today will help spur innovative clean energy technologies that will be central to the president's Clean Power Plan and combat climate change," said Secretary Moniz at the National Clean Energy Summit. "The Clean Power Plan is a tremendous opportunity for American businesses to be global leaders in solar and distributed energy technologies. This will help shepherd in a new era of clean energy jobs and a low-carbon economy that will deliver affordable and reliable power to America's homes and businesses."
Distributed energy technologies, such as rooftop solar, energy storage, smart grid technology, and methane capture for oil and gas wells, solve key energy challenges, create economic opportunity, strengthen energy security and reduce greenhouse gas emissions. Unfortunately, these distributed technologies may be limited by market barriers since commercial lenders are often unwilling or unable to take on the risk of a new or innovative technology until it has a solid history of credit performance and commercial operation. The LPO's announcement will help overcome market barriers and accelerate deployment of innovative distributed energy technologies by making one billion dollars of loan guarantee authority available through the existing Title XVII program and providing guidance on the types of financial structures it can support for distributed energy projects.
ARPA-E's Micro-scale Optimized Solar-cell Arrays with Integrated Concentration (MOSAIC) program is awarding $24 million to 11 teams across the country to develop new solar technologies that will create highly efficient photovoltaic (PV) panels that capture more sunlight using less area. For example, many roofs are not well suited for conventional solar panels due to their size and/or location, making them inefficient and costly for some residents, businesses and utilities. However, using Concentrated Solar Power (CPV) optical devices that concentrate sunlight onto a smaller, high efficiency solar PV receiver can reduce the footprint of conventional solar panels, while maintaining their ability to generate electricity.
Current CPV technologies are location dependent, and require expensive materials to integrate into existing solar systems. MOSAIC seeks to overcome these challenges and develop small CPV systems (known as micro-scale CPV technology) that integrate more affordable materials and manufacturing techniques into PV solar panels that can be adopted in more locations.
MOSAIC has selected projects in North Carolina, Massachusetts, Pennsylvania, California, Texas, Washington and New York to develop solar modules that integrate high-performance micro-scale concentrated PV technologies into "flat plate" solar panels to improve the efficiency and cost of solar technologies.
The Alliance to Save Energy is pleased with the announcements.
"On the heels of EPA's Clean Power Plan, which includes energy efficiency as the easiest, fastest and cheapest way to reduce overall greenhouse gas emissions, the Administration continues to advance energy efficiency as the cornerstone to building the modern American energy economy," said Kateri Callahan, president of the Alliance to Save Energy. "It is clear that the federal government and the private sector recognize that deploying energy-efficiency technologies and practices is the most important and effective means to realizing the goal of doubling U.S. energy productivity by 2030."
One such commitment could lead to wider adoption of state-level property-assessed clean energy (PACE) programs.
"We've been working to unlock private capital to fund energy efficiency improvements and renewables all over the country, across all building types. PACE is a proven policy tool that has driven nearly $1.3 billion in clean energy investments over the last five years," said Claire Broido Johnson, President of CBJ Energy, a Maryland based PACE-originator. "…PACE is just as transformative as the Power Purchase Agreement (PPA) that transformed the solar market we created when I founded SunEdison."
The continued involvement of the Federal Housing Finance Agency (FHFA) will be critical to help eliminate remaining barriers preventing homeowners from fully realizing the benefits afforded to them by PACE-financed energy efficiency.
"The White House today announced two initiatives at the sweet-spot where energy and finance intersect. The initiatives will help homeowners finance energy efficiency and solar improvements. It might sound too good to be true, but doing so can reduce utility expenses, improve property value, reduce pollution from power plants, and make better mortgage loans. Financing is important because the ability to borrow is often make-or-break for a homeowner's decision to invest in efficiency work or rooftop solar, just as getting a mortgage is make-or-break for the decision to buy a house in the first place," said Philip Henderson, senior financial policy specialist, Natural Resources Defense Council. "…FHA will lend additional funds at the time of a loan to buy a house or refinance if the added funds are used to make energy-related repairs and improvements. To be eligible for the added loan proceeds, the homeowner can use of a streamlined measure of home efficiency (the DOE's Home Energy Score) to show the improvements will reduce expenses. While the amount of added proceeds is small (2 percent), it's the right idea and program experience will be valuable."
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