Treasury Dept. pours $502M into renewable energy

The U.S. Treasury is joining the Department of Energy in backing renewable energy development, announcing the first wave of a dozen projects set to receive $502 million in cash grants instead of tax credits. Together, the 12 recipients represent 840 megawatts of power — nearly 3 percent of the U.S.’s total renewable energy production.
Wind emerged the big winner, with more than half the total sum — $294 million — going to five wind farms run by Portland, Ore.-based Iberdrola Renewables. First Wind Energy Holdings and Horizon Wind Energy also got generous shares of the pot. Solar, on the other hand, seems to have taken a back seat, with only two small firms selected. Solaire Development will get $2.6 million and Movement Gym PV System will get $157,809.
The Treasury called for applications for the money starting at the end of July, under the American Recovery and Reinvestment Act, and recipients should receive their shares (covering about 30 percent of project costs) over the next four days. The program was launched to relieve the liquidity drought in the renewable energy sector following the economic downturn. As it turns out, many banks are still wary to dole out large loans to cleantech developers. Even though it was under the Treasury’s jurisdiction, the DOE played a major role in reviewing the technical merits of each applicant.
The $502 million is just the first of several waves of support for renewables, which the Treasury says may eventually add up to $3 billion. It’s goal is to buttress about 5,000 projects divided between wind, solar, biomass and other alternative sources of energy. That being said, large wind farms seem to be the preference, with Department of Energy sources saying that those applications are being set aside for top review.
While the Treasury estimated that it received 150 applications for the money in the first round, it revealed that no candidates were outright rejected. About 20 to 30 percent of them had their applications returned with requests for more information. Interestingly, more than 100 of the apps came from projects that are already operational and need cash to keep running. And the remaining 43 projects are already under construction — many of which were sent back, keeping the focus on projects that will be up and running this year or next.
Also, perhaps surprisingly, the projects receiving Treasury funds are based largely in Oregon, New York and Pennsylvania, with none headquartered in renewable-heavy (especially solar-heavy) states like Arizona and California.
Since the program kicked off, it has received thousands of applications.