Solar Millennium Passes On DOE Loan

DFN: You may have heard, Solyndra took a DOE loan guarantee, and at best the technology didn’t deliver and / or PV prices moved against the project.

Solar Millennium Passes on DOE Loan Guarantee for Project, Stock Value Drops

August 19, 2011 – Solar Millennium is giving up the $2.1 billion loan guarantee it was awarded from the U.S. Department of Energy to seek commercial financing for its large-scale Blythe Solar Power Project, according to a press release from the company.

The company said in May that it had been awarded the $2.1 billion as part of the Department of Energy’s expiring loan guarantee program. Companies must break ground on projects by the end of September to qualify for the guarantees. The project will be delayed until 2012 to begin construction.

On this news, Solar Millennium stock plummetted. The shares sank as much as 59 percent to their lowest since the July 2005 listing after the company reported half-year results. They were down 46
percent to 4.20 euros at 1:23 p.m local time today after falling 29 percent yesterday.

Solar Millennium, which has projects in several countries using solar thermal technology, said it will seek financing for the initial 500 MW of its Blythe project in California next year through the
capital markets after adjusting its U.S. strategy. It will forgo the $2.1 billion in U.S. Department of Energy loan guarantees for this phase of the 1,000 MW project. The loan guarantees were expected to cover 75 percent of the construction costs for two initial
250-megawatt phases. The Erlangen-based company said it will focus on photovoltaics in the U.S. as the technology has “far more” profitable prospects for plants that do not require storage.

Solar Millennium has fallen for four straight days, bringing its decline this year to 79 percent and reducing its market value to about 53 million euros.


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