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President Announces Nearly $2 Billion Loan Guarantee for Solar Power Plants

By Madhubanti Rudra July 06, 2010
The states of Arizona, Colorado and Indiana are going get new solar power plants, thanks to promise of a hefty federal loan from President Barak Obama.
 
In a recent announcement, the president has guaranteed nearly $2 Billion to build solar manufacturing and power plant projects in Arizona, Colorado and Indiana. The government officials have informed that these are going to be major projects in the region.
 
Loan guarantees are different from direct government subsidies in that they act as a type of financial backstop---they serve as a kind of insurance that encourages private financing.
 
When it comes to Arizona, the U.S. Department of Energy has approved a conditional commitment for a $1.45 billion loan guarantee for a concentrating solar thermal power plant near Gila Bend, off Interstate 8 southwest of Phoenix.
 
The power plant, called Solana is going to be developed by Spainish development company Abengoa Solar. According to the reports, the upcoming plant would have a production capacity of up to 280 megawatts.
 
The Abengoa officials informed that the project would provide about 1,500 construction jobs and would result in about 100 permanent employees. One of the interesting point about this solar plant is; this plant would seek to extend solar electricity production beyond sundown.
 
"After years of watching companies build things and create jobs overseas, it's good news that we've attracted a company to our shores to build a plant and create jobs right here in America," President Obama said in his weekly Saturday radio address.
 
A Colorado-based thin-film photovoltaics manufacturer, Abound Solar has secured a conditional loan guarantee of $400 million from The Department of Energy. Abound Solar is going to build production plants in Longmont, Colo., and Tipton, Ind.
 
Abound Solar produces thin-film solar panels that use cadmium-telluride semiconductor materials to generate electricity from light. This technology is similar to the type used by Arizona-based First Solar Inc., one of the world's largest solar photovoltaic manufacturers. Abound Solar says it has developed a manufacturing process that reduces the cost of such panels.
 
The solar power plants will give big boost to the region's job market. When completed, the power plants would create a total of 1,500 permanent employees, the Energy Department said in a news release. In the construction phase, about 2,000 construction jobs would be needed. The manufacturing sites are expected to be in full production by 2013.
 
"Supporting this type of innovative renewable-energy project is part of our commitment to creating a clean energy future while significantly reducing greenhouse gases. This project will create jobs while helping to position the United States as a global leader in the development and use of clean energy," Secretary of Energy Steven Chu said in a news release.
 
In the past six months at least 40 new solar manufacturing startups or expansions have been announced in many states. Residential solar installations have soared this year and incentive programs have sold out or stepped down because of high demand since the spring in states such as Arizona, Nevada, New Jersey, Massachusetts, Minnesota and Tennessee.

Madhubanti Rudra is a contributing editor for IoTevolutionworld. To read more of her articles, please visit her columnist page.

Edited by Alice Straight

IoTevolutionworld Contributor

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