The US Department of Energy’s Loan Programs Office (LPO) has announced a conditional commitment for a loan guarantee of up to $15 billion to Pacific Gas & Electric Company (PG&E), a combined natural gas and electric utility serving Northern and Central California. The loan guarantee is part of the Biden-Harris Administration’s Investing in America agenda, specifically through the Energy Infrastructure Reinvestment (EIR) program.
The project, known as Project Polaris, aims to expand hydropower generation and battery storage, upgrade transmission capacity, and enable virtual power plants throughout PG&E’s service area. These infrastructure investments will help meet forecasted load growth, increase electric reliability, and reduce costs for PG&E’s 16 million customers across California.
The loan guarantee is the second Energy Infrastructure Reinvestment project under LPO’s flexible loan facility. Electric utilities must demonstrate that the financial benefits received from the DOE loan guarantee will be passed on to their customers or communities served by them.
PG&E plans to partner with the International Brotherhood of Electrical Workers (IBEW) Local 1245 to train and employ members of underserved groups in operational roles through its PowerPathway program. The company has committed to locate many projects in disadvantaged communities, as identified by the Climate and Economic Justice Screening Tool.
The loan guarantee supports projects that retool, repower, repurpose, or replace energy infrastructure that has ceased operations or enables operating energy infrastructure to avoid, reduce, utilize, or sequester air pollutants or greenhouse gas emissions. The LPO will verify PG&E’s ability to identify and execute eligible projects and ensure the company develops a comprehensive Community Benefits Plan.
The EIR program is part of President Biden’s Inflation Reduction Act, which created the Title 17 Clean Energy Financing Program (Section 1706). The loan guarantee is subject to certain technical, legal, environmental, and financial conditions before the Department enters into definitive financing documents and funds the loan.
Source: https://www.energy.gov/lpo/articles/lpo-announces-conditional-commitment-pacific-gas-electric-company-expand-hydropower