Backing an unproven technology can serve an environmental purpose without making every financing decision wise. DOE's December 15, 2016 final rule revises loan-guarantee regulations intended to encourage innovative energy technology and substantial environmental benefits. The ethical question is how to pursue those aims while remaining candid about the conditions attached to public credit. [2016-30006][2016-23268]

The program's eligibility description is specific. A qualifying project must address air pollutants or human-caused greenhouse-gas emissions and use technology that is new or significantly improved compared with commercial technology operating in the United States when the guarantee is issued. Those requirements connect innovation to environmental purpose. They are not evidence that an applicant's claimed benefits have already reached people or ecosystems. [2016-30006][2016-23268]

Financial stewardship appears in a different part of the rulemaking. The October proposal described a proposed condition under which Credit Subsidy Cost would be covered prior to or on closing by an appropriation, full borrower payment of that cost, or a combination. That account must not become a claim that the borrower pays all project funding, or that submitting an application secures public support. [2016-30006][2016-23268]

The final text caps expected Guaranteed Obligations principal at 80 percent of the eligible project's defined Project Costs, estimated at issuance. A ceiling is a constraint, not proof of a sound individual investment. The rule's stated effective date is January 17, 2017. These two stages of one DOE process invite attention to both environmental responsibility and financial candor; they do not resolve that balance through promises of benefits already achieved. [2016-30006][2016-23268]

Source documents

  1. Loan Guarantees for Projects That Employ Innovative Technologieshttps://www.govinfo.gov/content/pkg/FR-2016-12-15/html/2016-30006.htm
  2. Loan Guarantees for Projects That Employ Innovative Technologieshttps://www.govinfo.gov/content/pkg/FR-2016-10-03/html/2016-23268.htm