Biden's term countdown, the United States provides nearly $23 billion in loans to public utilities in 12 states.
The U.S. Department of Energy's Loan Office announced on Thursday that it will provide $22.92 billion in conditional financing to several energy utilities in 12 states.
The U.S. Energy Corp. Loan Office announced on Thursday that it will provide $22.92 billion in conditional financing to several energy utility companies in 12 states.
This funding will be provided through the Energy Infrastructure Reinvestment Program of the U.S. Energy Corp. Loan Projects Office (LPO), which was established under the Inflation Reduction Act signed by President Biden.
The program provides loan guarantees for projects that involve the refurbishment, replacement, or emissions reduction of energy infrastructure that is already out of operation.
The LPO manages over $385 billion in low-interest loans for companies with green energy projects such as batteries, nuclear power, and advanced vehicles, and this will be some of the final loans made during Biden's administration. President-elect Donald Trump is set to be inaugurated on January 20th.
Last month, the LPO announced a conditional loan of up to $15 billion to California utility company The Pacific Coal Power Plant (PCG.US).
The future of the LPO became uncertain after Trump took office.
Companies that have received this financing include two utility subsidiaries of DTE Energy Company (DTE.US) in Michigan, which received up to $8.8 billion in funds. This funding will be used to replace pipelines to reduce natural gas leaks and install renewable energy facilities.
Similarly, a subsidiary of CMS Energy Corporation (CMS.US) in Michigan, Consumers Energy Company, received a conditional loan commitment of up to $5.23 billion for investing in renewable energy and replacing old natural gas pipelines.
PacificCorp, a utility company serving six western states, received a loan commitment of up to $3.52 billion for building transmission lines to improve wind power transport capacity.
An official from the U.S. Energy Corp. department stated: "The loans issued to utility borrowers pose minimal risk to taxpayers." He added that unlike loans provided by the LPO for individual projects, loans to investment-grade utility companies are backed by the company's entire assets. "In rare cases, if default occurs, the LPO can recover the debt owed by either selling or acquiring the assets financed by the loan, up to the maximum amount of the loan."
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