On the record with DOE's cleantech finance boss
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Photo illustration: Annelise Capossela/Axios. Photo: Torsten Blackwood/AFP via Getty Images
Jigar Shah, head of the Energy Department's loan office, chatted yesterday with Axios Pro Climate Deals' Megan Hernbroth about his cleantech approach and what's next for the revived program.
Why it matters: It was largely dormant in the Trump era but has roughly $40 billion in loan authority for a wide range of innovative, climate-friendly projects.
The office has already reached preliminary deals for projects on critical materials for EV batteries, clean hydrogen and storage, and converting natural gas into hydrogen and carbon black.
Here are a few highlights from their interview...
1. Offshore wind talks are heating up. Finding ways to support the nascent sector has been on the office's radar for a while.
- But Shah signaled that it's entering a new phase, and he name-checked ways to support development of needed vessels in particular.
- "We have been facilitating that conversation for I'd say the better part of seven months now, and I finally got a couple of proposals from the industry last week," he said.
2. The debt finance bottlenecks for various innovative clean energy projects might not be obvious.
- "The biggest challenge honestly, is that most people aren't ready for our money," he said.
- "And so a lot of what we're doing is mentoring people and saying, 'well, here's how you get all of your permits, here's how we do the NEPA process. Here's how you get offtake agreements,'" he said.
3. Shah is looking for trendsetters. "We really are focused on the first of many, and not the one project that will never happen again," Shah said of the office's approach to seeking tech that can be replicated.
- "We really do need to see a profitable business model."
4. The private finance landscape is conducive to commercializing early tech.
- Shah talked about his office's role in backing projects and technologies that can then attract more capital and begin to scale with multiple projects.
- The good news: "I'd say that the valley of death today is far shallower than it's ever been," he said, referring to the notorious challenge of bringing lab- and pilot-level cleantech to commercial scale.
- "There's more equity available today than ever."
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