Two Solar Firms Nab $1.85 Billion in ARRA Loan Guarantees

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The sun is shining a little brighter for two solar power companies after they were selected last week to receive $1.85 billion in federal loan guarantees under the American Recovery and Reinvestment Act (ARRA).

Abengoa Solar Incorporated (Denver, Colorado), a unit of Abengoa S.A. (MCE:ABG) (Seville, Spain), will receive $1.45 billion in loan guarantees to build Solana, which is a 280-megawatt (MW) concentrating solar-power (CSP) generating station near Gila Bend, Arizona. Solana will be one of the world's largest CSP generators. Its electricity will be purchased by Arizona Public Service, a division of Pinnacle West Capital Corporation (NYSE:PNW) (Phoenix, Arizona). Construction will begin this fall, and the project is scheduled to be operational by mid-2013. An estimated 1,600 jobs will be created during the construction of the facility.

A $400 million loan guarantee was awarded to Abound Solar Manufacturing (Loveland, Colorado), which will manufacture advanced thin-film solar panels at plants in Longmont, Colorado, and Tipton, Indiana. Building the two plants will create an estimated 2,000 jobs. Once operational, the facilities will employ an estimated 1,500 people. The Indiana facility will be built in a now-closed Chrysler factory. Full manufacturing capacity at both facilities will be reached in 2013. When fully operational, the plants will manufacture enough thin-film solar material to generate 840 MW of solar power per year. Privately held Abound Solar says it has raised about $200 million in venture capital and private equity funding since being launched in 2007.

The Abengoa plant will be the first large-scale solar plant in the U.S. that can store the electricity it makes, according to the Obama administration. It will be able to generate enough electricity to power an estimated 70,000 homes. Abengoa Solar is operating 142 MW of solar plants worldwide, and it is building another 350 MW. It is said to be the only solar company in the world that builds and operates both trough and power tower CSP projects.

In announcing the loan guarantees, President Obama commented on the U.S. unemployment rate, which dropped to 9.5% last week, and emphasized the job-creation aspect of these two solar projects selected for load guarantees. "These are just two of the many clean-energy investments in the Recovery Act. Already, I've seen the payoff from these investments. I've seen once-shuttered factories humming with new workers who are building solar panels and wind turbines, rolling up their sleeves to help America win the race for the clean-energy economy."

On the broader economic-recovery front, the president said: "We're going to keep fighting to advance our recovery. And we're going to keep competing aggressively to make sure the jobs and industries of the future are taking root right here in America. That's one of the reasons why we're accelerating the transition to a clean-energy economy and doubling our use of renewable-energy sources like wind and solar power--steps that have the potential to create whole new industries and hundreds of thousands of new jobs in America."

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