SunPower gets federal backing

$1.2 billion loan guarantee will aid construction of 250-megawatt California Valley project; status of Topaz Farm remains uncertain

Staff and wire reportsSeptember 30, 2011 

A company that plans to build a solar project in eastern San Luis Obispo County got a loan guarantee from the federal Energy Department on Friday.

A guarantee worth $1.2 billion will help San Jose-based SunPower Corp. build a 250-megawatt solar plant called California Valley Solar Ranch. It has started construction.

At the end of last week, another company, First Solar Inc. of Arizona, announced that a $1.9 billion loan from the Energy Department fell through, causing an unspecified delay in the Topaz Solar Farm — a solar project planned for the Carrizo Plain.

First Solar announced it would not be able to meet a Sept. 30 deadline for the federal loan guarantee. Company officials say the project will continue, but a search for a buyer to finance the project without federal backing is under way.

Earlier this year, First Solar received final approval from the county to begin construction of the 550-megawatt photovoltaic plant at Highway 58 and Bitterwater Road. Beginning construction by Sept. 30 was a precondition for receiving the loan.

The company does not have a timeline for when construction might begin and did not disclose details about sale negotiations. First Solar also has not specified the total project cost.

First Solar was, however, able to close deals on different projects in California.

The deals announced Friday include a $1.5 billion loan guarantee to Florida-based NextEra Energy, GE Energy Financial Services and other investors that bought the Desert Sunlight project — a 550-megawatt solar farm on federal land in Southern California — as well as $646 million to Illinois-based Exelon Corp. for a 230-megawatt solar plant in the Antelope Valley north of Los Angeles.

First Solar will continue to build and operate both projects.

Additionally, $1.4 billion will go San Francisco-based Prologis Inc. to support installation of about 750 solar rooftop panels in 28 states.

The loan program expired Friday.

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