US Department of Energy issues $2bn loan deal for tribal lands
Tribal lands in the United States could soon see a new influx of renewable energy projects.
The vast tracts of land, making up an estimated 5.8 percent of the contiguous US, remain ideal locations to build clean energy, albeit largely untapped.
The US Department of Energy is issuing a $2 billion loan program to increase the availability of capital in these areas and promote new economic development.
The agreement will allow for up to 90 percent of a project’s financing to be guaranteed by the loan made “to a federally recognized Indian tribe for energy development,” according to its website.
While the loan deal is open to all forms of power plants, including fossil fuels, it is expected that renewable projects will benefit the most. Tribes have reportedly expressed an interest in developing clean energy, but often lack available financing.
“The Department has heard from tribes that they can have difficulty accessing the debt capital necessary to finance energy development projects that will benefit Indian country,” said Secretary of Energy Rick Perry.
“…the Department will work in partnership with private sector lenders to help them better understand the unique characteristics of tribal energy opportunities and catalyze future private sector investment that will have a meaningful impact on tribal economies…” he added.
The National Renewable Energy Laboratory estimates that tribal lands could provide 6.5 percent of the maximum clean energy potential across the United States. The vast majority of this comes from solar PV, concentrated solar power, and wind power.
Tina Danforth, President of the Native American Finance Officers Association (NAFOA), said the new program “represents a significant opportunity for Indian Country.”
“Deploying $2 billion in loan guarantees will strengthen tribal economies through private sector investment in a wide range of energy projects and activities,” she added.
In Canada, there has been a reported increase in the number of indigenous communities developing renewable energy projects. As of 2017, 152 communities were involved in new clean energy projects, up from 26 in 2008.
News published on Climate Action Programme
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