On June 5, Acting Agriculture Under Secretary for Rural Development Doug O’Brien announced publication of an Advanced Notice of Proposed Rulemaking (ANPR) requesting public comment on expanding renewable energy and project financing programs under the Rural Utilities Service (RUS). The RUS has invested billions of dollars since the 1930s through public-private partnerships to develop rural utilities infrastructure such as water, waste management, electricity, and telecommunications. RUS currently provides long-term financing to electricity utility systems in rural areas. The agency is considering regulatory changes related to “project financing” requirements to improve its ability to finance renewable electric infrastructure projects. RUS is considering clarifying the agency’s procedures for single asset/project financing arrangements for all RUS eligible projects. USDA is seeking comments on the guidance necessary to more effectively use project financing in the RUS loan program.
Renewable energy companies may want to comment on a number of questions that USDA has identified, chiefly:
- Are non-traditional applicants interested in using RUS for project finance?
- If the RUS were to expand its project financing authority, especially for renewable energy investments, what types of projects should qualify for project finance loans, given that RUS typically invests in commercially-proven technologies?
- What types of entities should qualify for RUS project finance loans?
- What type of credit support, in addition to power purchase agreements and corporate guarantees, should be used to secure the government’s interest and ensure a long-term revenue stream to repay project finance loans?
USDA will host two Town Hall meetings in Washington, DC on July 9, 2013 to discuss the proposed rulemaking. Comments are due by July 30. See the attached notice for more information.