Congress is back in session after a long summer break. And the first order of business in the House of Representatives is to pass the “No More Solyndras” Act, a bill designed to squash the Department of Energy’s embattled loan guarantee program for innovative clean energy projects.
But here’s something you won’t likely hear from lawmakers: Experience on the ground shows that the loan guarantee program is working as designed.
Partly boosted by the construction of large-scale solar projects supported by loan guarantees, the U.S. solar photovoltaic market is on track for a third consecutive year of triple-digit growth.
U.S. solar developers installed 742 megawatts of solar PV in the second quarter of 2012. And if growth continues, the industry could install more than 3,000 megawatts of projects this year, according to a new market report from GTM Research and the Solar Energy Industries Association.
While residential installations were flat and commercial installations dipped in Q2 of this year, utility-scale projects grew substantially. Two projects partly responsible for the boost — the 290-MW Agua Caliente project in Arizona and the 170-MW Mesquite project — received loan guarantees through the DOE. Neither project is fully complete yet, but both had phases come online this year. A third project, the 50-MW Silver State solar plant, was fast-tracked by the Interior Department and became the first large-scale solar facility to be developed on public lands.
If it were not for the growth in large-scale projects, the solar market would have declined by 18 percent rather than grow by 45 percent in the second quarter, according to the report.
Much of the political attention to loan guarantees has been focused on a few high-risk technology companies that went bankrupt (Abound Solar, Beacon Power, Solyndra); however, the majority of projects supported by the program were for large-scale power generation and fuel production. The loan guarantees were designed to help leverage private capital to finance these facilities during the economic downturn when private investors were wary of deploying capital. It worked. And today, dozens of “first-of-a-kind” projects are under construction or completed, helping boost America’s share of renewable energy.
In fact, because the loan guarantee program supported mostly generation projects with long-term contracts, analysis has found that it will cost taxpayers $2 billion less than initially expected.
Unfortunately, this story will likely be ignored by opponents still intent on politicizing Solyndra.