The US Energy Department’s (DOE) loan-guarantee is walking a fine line these days, which cannot make life any easier for 1366 Technologies and SoloPower as they prepare to receive funding from the same DOE guarantee that failed solar companies Solyndra and Abound Solar partook in. A report by Bloomberg noted that both 1366 Technologies and SoloPower qualified for guarantees last year and are currently working to meet milestone in order to gain access to the credit.
Executives at the two companies stated that they may receive approval as early as the end of this year for the guarantee, which would mark the first funding disbursed to US solar manufacturers since Solyndra filed for bankruptcy in September. It goes without saying that more than few eyebrows have been raised, especially on Capitol Hill, as news of the potential guarantee disbursements becomes wider spread.
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Republican lawmakers seem to be making the most noise regarding the guarantees, going so far as to propose a bill that would block the DOE from issuing additional loan guarantees. Damien LaVera, a spokesman for the Energy Department told Bloomberg, that “As long as [1366 Technologies and SoloPower] meet the terms and conditions of their agreement, including milestones, they can expect to receive funding as agreed.” LaVera continued that the Energy Department program was set up to support the advancement of companies developing new energy technologies and that not every recipient is expected to succeed.
Bloomberg noted that the DOE has provided nearly US$35 billion in loans, loan guarantees and conditional commitments to clean-energy companies, around 35% of which has been for solar power generating projects and less than 4% for solar manufacturers. However, the argument does not just involve the DOE, but extends to the Obama administration and, according to some analysts, will play a role in this year’s election.
SoloPower was awarded a US$197 million guarantee to make rolls of flexible solar panels and is building its first commercial production line in Portland, Oregon, funded partly by US$219 million in private equity and state incentives. “We haven’t taken any DOE loan money yet, and we won’t until we have the first line up and running,” Chief Executive Officer Tim Harris said in an interview with Bloomberg. “When that line is hitting certain metrics, before the end of the year or first quarter next year, we’ll take the first tranche of the DOE loan funding.”
1366 Technologies was given the approval to borrow as much as US$150 million to produce silicon wafers for solar panels. According to Frank van Mierlo, CEO of 1366 Technologies, the DOE established two conditions that the company must meet in order to access the funding. “They said first we want you to eliminate most of the technical risk by building and operating a demonstration plant, and then find private money to match the loan so it’s 50 percent loan, 50 percent equity,” he said in an interview. “There’s still some risk, but we are trying to mitigate most of the risk before drawing on the loan.”
The company is looking to raise US$50 million to build a demonstration plant that could possibly prove its technology is cheaper and more efficient than current polysilicon production methods. Its current fundraising total stands at US$47 million with van Mierlo anticipating the plant to be completed in the second part of 2013.