Last Thursday, U.S. Energy Secretary Steven Chu announced that a partial loan guarantee for a $1.3 billion loan has been finalized to support the world’s largest wind farm. The loan will finance the Caithness Shepherds Flat project, an 845-MW wind generation facility located in eastern Oregon sponsored by Caithness Energy LLC and GE Energy Financial Services.
The Caithness Shepherds Flat wind project will use 338 GE 2.5xl wind turbines, which are designed to provide high efficiency and increased reliability as well as grid integration. The wind farm is the first in North America to deploy these turbines, which have been used in Europe and Asia. Once completed, the project will sell 100% of the power and renewable energy credits generated to Southern California Edison under 20-year fixed price power purchase agreements.
According to company estimates, the project will directly employ 400 workers during construction and 35 workers during operation. The company projects the wind farm will avoid over 1.2 million tons of carbon dioxide per year, equivalent to the amount of carbon dioxide from approximately 200,000 passenger vehicles.
The Caithness Shepherds Flat project is the sixth Recovery Act-supported project to close and the largest to date to receive a loan guarantee under the Financial Institution Partnership Program (FIPP). The $1.3 billion loan is funded by a group of 26 institutional investors and commercial banks led by Citi, Bank of Tokyo-Mitsubishi UFJ, Ltd., RBS Securities, and WestLB Securities Inc. The closing of this transaction reflects the market acceptability of the loan guarantee model under FIPP, including cooperation among multiple creditors.
The DOE, through the Loan Programs Office, has issued loan guarantees or offered conditional commitments for loan guarantees to support 16 clean energy projects totaling nearly $16.5 billion. Together, the DOE said, 16 projects total over 37 million megawatt-hours [sic] of capacity. Additional DOE-supported projects include two of the world’s largest solar thermal projects and a 2,200-MW nuclear power plant, the nation’s first in three decades.