DOE Closes $72.8M Loan Guarantee for Microgrid on Tribal Lands
The U.S. Department of Energy (DOE), through its Loan Programs Office (LPO), has closed on a $72.8 million loan guarantee to finance the development of a solar-plus-long-duration-energy-storage microgrid.
The microgrid is set to be located on the Tribal lands of the Viejas (Baron Long) Group of Capitan Grande Band of Mission Indians of the Viejas Reservation near Alpine, Calif. This project, supported by a grant from the California Energy Commission, investments from U.S. Bancorp Impact Finance and Starbucks, will provide the Viejas Band with renewable energy generation and storage infrastructure through the installation of a 15 MW PV solar generation system and a 70 MWh battery long-duration energy storage system.
“When President Biden and Vice President Harris say that every community deserves the opportunity to benefit from our clean energy future, they mean it,” says U.S. Secretary of Energy Jennifer M. Granholm.
“Thanks to game-changing new funding from the Investing in America agenda, DOE is making a first-ever announcement through our Tribal Energy Financing Program, reinforcing this Administration’s commitment to helping build stronger, more resilient Tribal and Indigenous communities.”
After solar and battery system installation, the Viejas Band of Kumeyaay Indians will purchase electricity through the project company under a long-term power PPA to help operate various commercial businesses including gaming, hospitality and retail facilities.
When complete, the project will allow the Tribe to benefit from a lower cost of energy, allowing savings to be redirected toward investments by the Tribe in infrastructure maintenance, operation of the fire department, Tribal culture and educational programs and other Tribal member services.
The project developer, Indian Energy, is a Native-owned microgrid developer and systems integration firm. Both the project company and the borrower, which is a TEDO, are owned by Indian Energy, Turtle Mountain Band of Chippewa Indians and the Sault Ste Marie Tribe of Chippewa Indians.
LPO is providing a maximum guarantee of $72.8 million, for a U.S. Bancorp Impact Finance loan amount of up to $100 million to complete the construction of the microgrid system. Additionally, DOE’s loan guarantee is supported by anchor investments from U.S. Bancorp Impact Finance and Starbucks to construct the solar microgrid providing renewable energy to the Tribal community.
The project developers have previously received $43 million in state financial assistance through two grants from the California Energy Commission for the development of the long-duration energy storage system that will provide renewable backup power to the Tribe and support statewide grid reliability in the event of an emergency.
The Viejas Microgrid project supported by this loan guarantee would build on the state’s financial support.