September 23, 2011 / 7:46 PM / 6 years ago

SolarCity latest to see loan loss post Solyndra

LOS ANGELES/WASHINGTON (Reuters) - Solar panel installer SolarCity said on Friday it was the second company in as many days that will not get finalization of U.S. government loan aid by a September 30 deadline.

The Department of Energy informed SolarCity of its inability to close the loan 48 hours ago, blaming increased paperwork resulting from a Congressional investigation into the Department of Energy’s $535 million loan guarantee awarded to bankrupt solar company Solyndra, SolarCity said in a letter to the Republican lawmakers heading the probe.

The DOE loan guarantee program, which is under fire for missing signs its first recipient of loan aid, Solyndra, was bleeding money before it went bankrupt, has nearly $9 billion in loans still to finalize.

SolarCity’s $275 million loan guarantee was intended to fund a plan, called SolarStrong, to install up to 160,000 rooftop solar systems on military family homes. The conditional loan guarantee was offered on September 2, SolarCity said.

“Unfortunately, Project SolarStrong, together with the thousands of job years it would create and the benefits it would bring to our country’s military communities, is at risk of becoming an unintended casualty of the controversy over Solyndra,” SolarCity CEO Lyndon Rive said in the letter.

Rive later said in an interview that SolarCity can furnish the documents to the department in weeks, and that the government loan aid could still be approved at a later date.

But he said the DOE’s move could forced the company to look to private financing for the project.

USRG Renewable Finance was the lead lender on the SolarStrong project and Bank of America Merrill Lynch had intended to provide debt financing and advisory services.

Just a day earlier, solar industry stalwart First Solar Inc said it would not meet the DOE deadline for a loan guarantee that would fund a huge solar power plant in California. The project had received conditional approval for $1.9 billion in loan aid in June.

Officials for both Sempra Energy and SunPower Corp said they are continuing to work toward closing their DOE loan guarantees for solar power plants.

A spokeswoman for solar thermal start-up SolarReserve would not comment on the status of the company’s conditional loan guarantee offer.


Several renewable energy companies that are not invested in solar power got good news from the DOE on Friday.

POET, the world’s largest ethanol producer, said on Friday the DOE finalized $105 million in loan aid for a cellulosic ethanol plant to be built in Iowa.

It also finalized a partial guarantee for up to $350 million in aid for three geothermal power facilities sponsored by Ormat Nevada Inc.

In addition, DOE finalized a partial guarantee for nearly $170 million for Granite Reliable Power, LLC. The aid will support the building of a 99 megawatt wind power project in New Hampshire, that will consist of 33 turbines built by Danish company Vestas.

Reporting by Nichola Groom in Los Angeles, Timothy Gardner in Washington and Braden Reddall in San Francisco; editing by Andre Grenon and Gunna Dickson

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