Earlier this month, the U.S. Department of Energy (DOE) requested comments on its draft solicitation for advanced fossil energy loan guarantee projects that significantly reduce greenhouse gas and other pollution emissions. This Advanced Fossil Energy Projects loan guarantee solicitation was authorized in Section 1703 of the Energy Policy Act of 2005, and DOE is moving forward with this solicitation as part of the Obama Administration’s Climate Action Plan.
As part of this solicitation, DOE may make available more than $8 billion in loan guarantee authority for eligible projects. As envisioned, eligible projects would be advanced fossil energy projects and facilities that reduce greenhouse gas emissions in the areas of advanced resource development, carbon capture, low-carbon power systems, and efficiency improvements. The program was included in EPAct 2005 because advanced fossil energy projects are typically unable to obtain conventional commercial financing due to the high level of risk involved in the technologies.