The Department of Energy announced Thursday that it has awarded First Solar, America’s dominant solar manufacturer, nearly $4.5 billion in conditional loan guarantees to support the construction of three solar power plants in Southern California.
With the latest awards, First Solar, headquartered in Tempe, Ariz., has nabbed a third of the $16 billion in loan guarantees the DOE has granted for solar generation to date. In January, First Solar was awarded a nearly $1 billion loan for its 290-megawatt Agua Caliente project in Arizona.
First Solar expects the three projects, which should begin delivering electricity in 2014, to create 1,400 construction jobs in California.
The company has manufacturing facilities in Ohio, Germany and Malaysia. First Solar says it will manufacture the 20 million solar panels for the three California projects at its Ohio factory and in a new facility being built in Mesa, Ariz.
“These projects will bring immediate jobs to California in addition to hundreds more across the supply chain,” Energy Secretary Steven Chu said in a statement. “Together the projects will power hundreds of thousands of homes with clean, renewable power and increase our global competitiveness in the clean-energy economy.”
The DOE has awarded loan guarantees to 15 solar generation projects to date, with more expected to be announced in the coming weeks as the loan program, which is funded by the federal stimulus package, winds down. Large-scale solar power plants are capital-intensive projects, and the DOE guarantees make it easier for companies and project developers to raise funds from private investors.
“This creates a bridge for financing,” said First Solar spokesman Alan Bernheimer. “As these plants start getting developed, the private capital markets will get more comfortable.”
The DOE is offering a $680 million loan guarantee for the Antelope Valley Solar Ranch 1 project in the Mojave Desert, $1.88 billion in loan guarantees for the Desert Sunlight project in Riverside County, and $1.93 billion in loan guarantees for the Topaz Solar project in San Luis Obispo County.
Construction on Antelope Valley should begin next month; the larger Topaz and Desert Sunlight projects are awaiting final permits but are expected to begin construction in the fall.
First Solar was founded in 1999, began commercial production in 2002 and went public in 2005. The company makes thin-film solar panels using cadmium telluride rather than the more common silicon. Its panels are the lowest-cost in the industry, and the company is widely used as a solar industry benchmark.
The company’s stock rose about 2 percent on the news Thursday, to close at $132.27.
“First Solar is still one of the highest-quality solar names, with a cost advantage and industry-leading margins,” Pavel Molchanov, an analyst with Raymond James, wrote in a note. “We maintain our ‘market perform’ rating.”
Contact Dana Hull at 408-920-2706. Follow her at Twitter.com/danahull.
Three new solar projects
1. $1.93 billion to support the 550 megawatt Topaz Solar project in San Luis Obispo County
2. $1.88 billion to support the 550 megawatt Desert Sunlight project, located in eastern Riverside County
3. $680 million to support the 230 megawatt Antelope Valley Solar Ranch 1 project in the Mojave Desert
