People asked to support an energy program deserve to know both its environmental purpose and how public credit enters the financing. DOE's December 15, 2016 final rule revises the Title XVII loan-guarantee framework. The stated goals include commercial use of new or significantly improved energy technologies and substantial environmental benefits, rather than funding every project described as innovative. [2016-30006][2016-23268]

The eligibility description joins two tests: projects must avoid, reduce or sequester air pollutants or human-caused greenhouse-gas emissions, and employ technology that is new or significantly improved compared with commercial technology operating in the United States when the guarantee is issued. These are program conditions. They do not demonstrate cleaner air already delivered to a particular community. [2016-30006][2016-23268]

The October 3 proposal makes the allocation of financing responsibility more visible. Its proposed closing condition allowed the Credit Subsidy Cost to be covered prior to or on closing through an appropriation, full borrower payment of that cost, or a combination. Full payment here concerns the credit subsidy cost, not the entire project's funding. The proposal itself was not operative law. [2016-30006][2016-23268]

The final text separately limits expected Guaranteed Obligations principal, estimated at issuance, to 80 percent of the eligible project's defined Project Costs. That ceiling is not an award promise or proof that public exposure disappears. The rule specifies January 17, 2017 for effectiveness. Read together, these stages of one DOE process support scrutiny of both environmental eligibility and financing responsibility, not a verdict that the program has already produced its intended benefits. [2016-30006][2016-23268]

Source documents

  1. Loan Guarantees for Projects That Employ Innovative Technologieshttps://www.govinfo.gov/content/pkg/FR-2016-12-15/html/2016-30006.htm
  2. Loan Guarantees for Projects That Employ Innovative Technologieshttps://www.govinfo.gov/content/pkg/FR-2016-10-03/html/2016-23268.htm