Release
Blythe, the world’s largest solar power plant project, has passed the crucial milestone on its way to the financial close for the first two of a total of four projected solar-thermal power plants. The US Secretary of Energy, Dr. Steven Chu, today offered the project company a conditional commitment for a USD 2.1 billion loan guarantee. The loan guarantees are the precondition for financing some 75% of construction costs of the first two 242 megawatt (MW) power plants with borrowed capital from the US Federal Financing Bank. Solar Trust of America LLC, the American company unit within the Solar Millennium Group, already began construction of the parabolic trough power plants Blythe 1 and 2 at the end of 2010.
Dr. Christoph Wolff, CEO of Solar Millennium AG: “As already announced at the press conference on the occasion of our annual financial statements, the conditional commitment offered by the Obama administration means that we have reached the home stretch in the granting of loans by the US Federal Financing Bank. In times of restrictive public budgets, I am particularly pleased that the US government is so clearly committed to the energy turnaround, in which our Blythe power plants will have a great share. For us this commitment is the most important prerequisite for entering into successful and detailed negotiations with institutional investors regarding their involvement in the two power plant projects.” The total investment sum for the first two solar-thermal power plants projected in Blythe amounts to roughly USD 2.8 billion.
The conditional commitment defines the covenants to be met by the applicant in order to receive the loan guarantees by the US Department of Energy (DOE). Among other conditions, this also includes the conclusion of a respective general contractor agreement and securing the equity share in total investment. The Executive Board of Solar Millennium assumes that the Company will manage to meet all of these conditions by late summer this year. According to the eligibility guidelines, the conditional commitment is offered to companies which, after intensive scrutiny by the DOE, are believed to be able to meet the contractual provisions.
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