Energy Dept. delivers solar loan to Solyndra
Agency approves the first loan guarantee in four years to solar start-up Solyndra, a sign that it intends to move quickly to finance cash-strapped green-tech companies.
Demonstrating that it plans to act quickly with clean-energy loans, the U.S. Department of Energy has made $535 million available to solar start-up Solyndra.
The loan guarantee, announced on Friday, is the first to be approved by the Department of Energy in four years. As part of a broader government stimulus plan, the administration of Energy Secretary Steven Chu has committed to to clean-energy companies.
For Solyndra, the loan will partially finance construction of a second factory in California. The 4-year-old company, based in Fremont, Calif., has designed cylinder-shaped solar cells that are assembled onto arrays for the flat roofs of corporate and industrial buildings.
The flexible cells are made from a combination of CIGS (copper, indium, gallium, and selenide), an alternative to traditional silicon cells. The company began making the cells last year. The second factory will allow it to make 500 megawatts' worth of cells a year, according to Solyndra.
For Solyndra, the loan allows the company to ramp up more quickly and reduce the cost of the solar power its product produces. The plant is set to employ about 1,000 people, once operating, and employ 3,000 people in its construction.
To the broader green-tech industry, the Energy Department loan is an encouraging sign. Several green technologies have been developed over the past five years, but a number of companies are struggling to get the financing available to scale up their operations and sales.
The money for Solyndra was appropriated in the Energy Act of 2005. On taking office, Chu made dispersing existing and newly available loans a high priority, and created a process specifically for evaluating and. With the passage of the massive government stimulus package earlier this year, the federal energy agency has billions of dollars available for loans, for which a number of green-tech companies have applied.
Solyndra's loan is a "conditional commitment," which means that it still needs to meet certain conditions, including having its own equity available to get the loan.