INTRODUCTORY SPECIAL INTRODUCTORY ... - PHOTON Info

A sprawling piece of legislation
All of this, no doubt, would be music
to the ears of those crafting President
Obama’s energy policy. Even before he
took office last January, Obama made it
clear that supporting renewable energy
sources like PV would be a top priority,
with administration officials often men-
tioning a goal of doubling the amount of
energy produced from renewable sources
over the next three years.
If that’s the goal of the administra-
tion, then clearly the way to get there
– and, more generally, develop the capa-
bility and infrastructure for a low-carbon
economy while attempting to create jobs
– is largely via the $787 billion stimulus
bill. Even President Obama’s choice of a
location to sign the bill was a message
about the importance of renewables, and
PV in particular: the bill was signed at
the Denver Museum of Nature and Sci-
ence, where the president not only took a
tour of the facility’s rooftop PV array, but
was joined at the bill signing by a host of
installers and other industry types.
Political theater and photo-ops pro-
vide good publicity for PV, but far more
important, of course, are actual policies
and budgets. So what in the stimulus
bill actually supports PV? Well, quite a
lot. In fact, the bill includes 19 programs
that benefit solar in some way, albeit
most of them are designed to help out re-
newables in general, and therefore open
to applications from PV companies.
Understanding every element of the
stimulus package with the potential to
benefit PV is no easy task. For instance,
the US military recently awarded $152
million to install 15 to 20 MW of PV at fa-
cilities around the country; the govern-
ment will also now be more aggressive
about procuring PV for public buildings;
and the stimulus also made what Rhone
Resch, president of the Solar Energy In-
dustries Association in Washington, DC
considers a vital change by removing
what he says was a penalty on subsidized
energy financing. »If you received grants
from the state, or a discount in the in-
terest rate for your project development
from the state or bonds, then you had to
reduce the basis for which the federal tax
credit would apply,« he says. »If you’re
installing at $8 per W and you get a $3
state subsidy, you could only take the 30
percent tax credit on the $5 per W.«
But arguably the most important stim-
ulus program, at least for the moment, is
A hand up: Blake Jones, CEO of Colorado-based installer Namaste Solar, shows off the solar panels on the roof
of the Denver Museum of Nature and Science, where President Obama signed the stimulus bill into law. Solar
executives like Jones have been very supportive of the stimulus bill’s assistance to PV
November 2009 41
Namaste Solar Electric
»
in section 1603 of the stimulus bill, which
gives the Treasury Department the au-
thority to make cash grants to renewable
energy projects. For selected PV projects,
the Treasury grants can provide up to a
30 percent reimbursement of a devel-
oper’s total costs. This component of the
stimulus was much needed, many argue,
because traditional tax equity financing
for large PV plants essentially dried up
during the financial crisis. »The grant in
lieu of the standard investment tax credit
(ITC) should eliminate the problem in the
market today where there is very little tax
equity investment,« says Frank DeRosa,
CEO of Nextlight Renewable Power, LLC,
a San Francisco, California-based devel-
oper of utility-sized solar plants. »It will
simplify our financing.«
Like much of the stimulus package,
the Treasury grant program is designed
to produce quick results. The idea is that
an immediate boost to renewable energy
projects will help jumpstart job creation
and economic growth – the administra-
tion’s number one priority. Applications
for the program have been accepted and
reviewed since July 31st, and the first
awards were announced just a little over
a month later, on September 1st when
the first $500 million of an expected $3
billion was dispensed. In order to be eli-
gible for a grant, PV projects have to be-
gin construction by the end of 2010, and
operational by New Year’s Day of 2017.
The DOE loan guarantee program is
the other main stimulus-funded pro-
gram. It too is designed to provide a big
boost to financing renewable energy proj-
ects. The loan guarantees were delineated
in sections 1703 and 1705 of the stimulus
bill: section 1703 is designed to support
new and innovative technologies, while
1705 provides help for more convention-
al, commercial projects.
When we went to press, only the loan
guarantee program for new technologies
had made much headway – there are still
no clear rules for how the commercial
loan guarantee program will function.
In late July, the DOE announced that it
would provide up to $30 billion in loan
guarantees and released a solicitation to