Tyngsboro, Mass., July 2, 2009 – Beacon Power Corp. received a conditional commitment from the U.S. Department of Energy (DOE) for a $43 million loan guarantee.
The DOE’s offer outlines terms for a loan that would finance more than 60 percent of Beacon’s planned 20 MW flywheel-based energy storage plant to be located in Stephentown, New York.
The plant, which will provide frequency regulation services, will help stabilize and enhance the performance of the grid. Its emission-free operation will also significantly reduce CO2 levels, as compared to fossil fuel-based regulation methods used today.
The loan, which would be funded by the U.S. Treasury’s Federal Financing Bank, is expected to provide debt financing for 62.5 percent, or $43 million, of the estimated $69 million total project cost. About $50 million of this total cost is direct equipment and facility costs. Beacon’s equity contribution of roughly $26 million will be provided by a combination of cash, in-kind assets, and other eligible project costs. Before the loan can be closed, the DOE’s conditional commitment is subject to negotiation and completion of a number of contracts and conditions.
Out of 143 pre-application submissions in late 2007, Beacon’s 20 MW energy storage plant was one of just 16 projects invited to submit a full application for loan guarantee consideration. Of these 16 projects, Beacon’s was the only one selected in the “Electricity Delivery and Energy Reliability” category.