House budget proposal nixes loan guarantees for renewables
H.R. 1, the federal spending bill passed by the U.S. House last week, proposes to rescind $25 billion in unobligated funds from the U.S. DOE’s Loan Guarantee Program, including $100 million for a waste-to-energy plant in New York.
While the cuts would largely impact solar projects, a 20-megawatt biomass gasification project fueled by municipal solid waste currently under construction in Montgomery, N.Y., will lose out on a $100 million loan guarantee that it is relying on to help finance the project, unless section 1425 is struck from the bill before it’s approved by the Senate.
In August, Taylor Biomass Energy LLC was notified that the project would receive the loan guarantee pending a due diligence review. According to the office of Congressman Maurice Hinchey, D-NY, who has been working with Taylor Biomass officials for the past few years to make the project a reality, the company would otherwise be 60 to 90 days away from receiving the funds.
Hinchey said the cut would kill more than 400 private sector jobs, damage the Orange County economy, and hurt a local small business. "I have been working for years to help initiate this project, but now the Republican spending bill takes back the loan guarantees that were already promised,” he said. “Taylor Biomass has already broken ground on this project and invested substantial amounts of private capital already.”
Taylor Biomass has previously received funding for its project through the New York State Energy Research and Development Authority, and will also benefit from a 30 percent federal grant for clean energy projects.
Sen. Charles Schumer, D-N.Y., another strong supporter of the project, has also indicated he will staunchly oppose the loan guarantee cuts. “This is a project supported by both parties on the local level, and I will fight to save these loan guarantees, so that Taylor can fulfill its promise as a job creator for the region,” he said. “While it is clear we must eliminate wasteful spending, we need to do it with a scalpel, not a meat clever; it is reckless to slash such a critical investment in our future and I am optimistic that we will save these loan guarantees in the Senate.”
President of Taylor Biomass Jim Taylor is building the plant next to his family-owned recycling business, which accepts and recycles construction and demolition debris. He said the process of getting the project to where it is now—in particular, the five years it took to gain all necessary permits—has been exhaustive and draining.