The US Energy Department wants to loan $43B for EV and clean energy projects
– Mar. 26th 2021 11:15 am ET
US Department of Energy secretary Jennifer Granholm announced earlier this month that she will revive the agency’s Loan Programs Office (LPO), which funded Tesla. It has $43 billionin lending authority for large-scale energy infrastructure projects and advanced technology electric vehicle manufacturing.
US Energy Department loan plan
The US Department of Energy is planning to pump billions of dollars into the electric vehicle industry to boost domestic production and deployment. Securing America’s Future Energy projects the US could create 647,000 electric vehicle jobs in the next five years.
On the clean energy side, the LPO has $4.5 billion available for renewable energy and energy efficiency projects – roughly 10% of the existing $43 billion.
Experts have called for reforms to the LPO that will make it easier for applicants to apply and access funds, including changes to the application fee and other cumbersome aspects of the application process. The program also needs to boost trust among applicants after years of dormancy under the Trump administration, a step Granholm took by naming clean energy entrepreneur Jigar Shah to lead the office. Among other things, Shah has noted the need to focus on more clean energy development, and the economic development opportunities that creates, to tribal lands.
LPO departments
The LPO has three main departments: Title XVII for energy, the Advanced Technology Vehicles Manufacturing Loan Program (ATVM) for transportation, and the Tribal Energy Loan Guarantee Program.
Title XVII: Title XVII has provided over $25 billion to an “all-of-the-above” energy portfolio, including solar, wind, advanced nuclear, geothermal, and more.
Title XVII is responsible for notable clean energy successes, such as the utility-scale solar market in the US. The loan program’s early investments in utility-scale solar led to a boom in private sector financing in the solar industry shortly thereafter. Solar prices have fallen 70% over the past decade, and in 2019, the industry generated more than $18 billion in investment in the US economy. The solar sector now boasts one of the fastest growing job rates in the US and is expected to be the country’s leading source of new electricity generation this year.
Advanced Technology Vehicles Manufacturing Loan Program: The Advanced Technology Vehicles Manufacturing Loan Program (ATVM) has more than $17 billion remaining for technologies, including electric cars.
- In 2010, the ATVM funded the nation’s first two electric vehicle manufacturing facilities by Nissan and Tesla, with Tesla repaying its entire $465 million loan nine years ahead of schedule.
- ATVM loans have been used to build or retool factories across eight states: Illinois, Michigan, Missouri, Ohio, Kentucky, New York, Tennessee, and California. These factories have produced millions of advanced technology vehicles.
Tribal Energy Loan Guarantee Program: The Tribal Energy Loan Guarantee Program was launched in 2018. It has up to $2 billion it can provide in partial loan guarantees made to a federally recognized Indian tribe or tribal energy development organization. The program can back up to 90% of the unpaid principal and interest due on eligible loans provided for any type of energy development made on tribal lands.
Zoe Lipman, director, manufacturing & advanced transportation, of the BlueGreen Alliance, which unites labor unions and environmental organizations, told Electrek:
Through the energy and manufacturing loan and grant programs at the LPO, we have the opportunity to make investments at scale that not only make the US the leader in deploying clean and advanced energy technology, but ensure we retool factories building the clean vehicle and energy technology of the future, fill critical supply chain gaps, and reinvest to transform essential energy-intensive industries. Using these avenues, we can keep and create good jobs in America and help ensure cleaner, safer jobs and communities here and worldwide.
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About the Author
Michelle Lewis
Michelle Lewis is a writer and editor on Electrek and an editor on DroneDJ, 9to5Mac, and 9to5Google. She lives in St. Petersburg, Florida. She has previously worked for Fast Company, the Guardian, News Deeply, Time, and others. Message Michelle on Twitter or at michelle@9to5mac.com. Check out her personal blog.
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