The U.S. Department of Energy has announced a $1.37 billion conditional loan guarantee for the Ivanhoe Solar Complex in the Mojave Desert. The project, managed by Brightsource Energy, will use mirrors to concentrate sunlight, creating high temperatures that can be used to generate electricity. The complex will include three power plants that together will produce about 400 megawatts of electricity.

Basically, the guarantees would cover the loans in the case of default. The money for the loans is expected to come from the Federal Financing Bank.

One of the biggest challenges that large solar developments face is getting financing, particularly because few such solar power plants have been built. The DOE guarantees help on this front.

But other challenges remain, including getting approval from the government to actually build on the chosen sites, and clearing the National Environmental Policy Act review. The application process for the plants started nearly 3 years ago, and construction on the sites has already been delayed. Before the process is over, new hurdles might get thrown up, a possibility illustrated recently when Senator Dianne Feinstein (D-CA) submitted legislation to ban solar projects from some parts of the Mojave desert, a move that threatened several projects already in the works.

The government has been promising to guarantee loans for nuclear power plants for years--as a way of bringing down the cost of financing these fantastically expensive projects. Now the Department of Energy has actually issued its first one, an $8.33 billion guarantee to support the construction of two nuclear reactors to be built at the site of an existing nuclear power plant in Burke, GA.

It's been decades since new nuclear reactors have been built in the United States. In 2005 Congress passed a law allowing the DOE to issue loan guarantees for nuclear power plants to get construction going again. But it's taken until now for the department to issue one. (Read the TR article "Obama Goes Nuclear" to see why the guarantees are needed.) The $8.33 billion is part of the $18.5 billion provided for such loan guarantees in the 2005 bill. President Obama's proposed budget would increase the total by $36 billion, enough for about seven new plants.

The loan guarantee for the Burke reactors comes with a catch, however. The design for the nuclear reactors to be used there--the Westinghouse AP1000--hasn't yet passed muster with the Nuclear Regulatory Commission. Last October the commission informed Westinghouse that it had to fix problems with the "shield building" which is supposed to protect the reactor from "severe weather and other events."

When the new Advanced Research Projects Agency for Energy (ARPA-E) requested proposals for its first round of funding, it received thousands of them, but only 43 received any cash. Some of the other proposals will get a second chance in another funding round focused on three interesting areas of research, which Energy Secretary Steven Chu announced today.

The first is research into something called "electrofuels," which the agency describes as a "new paradigm for the production of liquid fuels." The idea is to engineer organisms that can convert carbon dioxide into liquid fuels such as diesel, but not through photosynthesis. It sounds a little convoluted. First you take energy from the sun and use it to produce hydrogen, electricity, or some other "energy carrier." Engineered organisms then use this energy to convert carbon dioxide into fuel. The hope is that this will prove more efficient than photosynthesis.

I'm working on a story that will have more detail on this approach to making fuels; I hope to get it up on the website this week.

The agency will also be funding research into cheap, high energy batteries and into carbon dioxide capture from coal fired power plants. The first round also funded some projects in this area.