The joint Office of Indian Energy Policy and Programs (IE)/Loan Programs Office (LPO), Tribal Roundtable was held online May 5, 2021, with Wahleah Johns, IE Senior Advisor, and Director, and Jigar Shah, LPO Director.
The virtual event was opened by LPO Senior Advisor John Lushetsky and moderated by Carla Fredericks, Executive Director for the Christensen Fund, whose mission is to back the global Indigenous Peoples movement in its efforts to advance the rights and opportunities of stewards of biocultural diversity.
Purpose and Goals
The purpose of the Roundtable was for IE and LPO to hear about challenges in developing tribal energy projects and explore how debt financing programs offered through the U.S. Department of Energy (DOE) can be structured to address them. Attendees included tribal leaders and staff, developers, banks, and others interested in tribal energy development.
IE helps Indian tribes and Alaska Native villages achieve their energy visions for the future of their communities and is authorized by Congress under the Energy Policy Act of 2005 to:
- Promote Indian energy development, efficiency, and use.
- Reduce or stabilize energy costs.
- Enhance and strengthen Indian tribal energy and economic infrastructure relating to natural resource development and electrification.
- Bring electrical power and service to Indian lands and the homes of tribal members located on Indian lands or acquired, constructed, or improved (in whole or in part) with federal funds.
To address these mission-driven priorities, IE works with America Indian tribes and Alaska Native villages to develop and deploy self-determined energy solutions that maximize community benefits through:
- Education and capacity building
- Financial and technical assistance
- Access to capital.
The LPO Tribal Energy Loan Guarantee Program (TELGP) can guarantee up to $2 billion in loans to support economic opportunities to tribes through energy development projects and activities. Under this program, DOE can guarantee up to 90% of the unpaid principal and interest due on any loan made to a federally recognized Indian tribe or Alaska Native corporation, or tribal energy development organization for energy development.
Several key themes and issues emerged from the questions submitted during the Roundtable.
- Improve the grant application and award process.
- One commenter noted that delays in the grant process ties up valuable resources for tribes and prevents them from combining DOE funding with other resources.
- To address these issues, DOE should consider greater funding of technical support to assist tribes in developing funding requests and projects.
- DOE should also consider reducing the monetary match requirements for grants as well as additional financial support to build capacity for tribes in energy project development.
- Alaska Native tribes have unique needs that need to be addressed through tribal energy projects and funding.
- DOE should clarify where Alaska Native tribes are eligible for funding and that the tribes not be required to hold federally recognized Indian trust lands.
- Funding should include the range of Alaska Native entities, including Alaska Native Claims Settlement Act village and regional corporations and nonprofit consortia.
- There is a strong need for microgrid systems to provide power. There is also a strong need to develop broadband, water source, and wastewater power systems.
- In Alaska, housing authorities are frequently the entities most intimately acquainted with the housing and infrastructure needs of a particular village, and often the only local project developer. Allowing them to apply directly for energy programs can be one of the most impactful tribal energy policies DOE can implement or advocate for at this time.
- Lack of capital is a significant impediment to tribal energy project development.
- Most tribes have very few financial resources to fund either development of energy projects or contribute needed capital for cost-share or financial equity.
- Additional requirements to fund National Environmental Policy Act environmental studies and applications and interconnect studies or queue fees are additional impediments to project development.
- Tribal projects are also challenged by a historic lack of access to transmission.
- The Department of Energy should consider revisions to the Tribal Energy Loan Guarantee Program.
- TELGP should be used to a greater extent to fund development activities, including legal costs, engineering studies, and financial planning that occurs preconstruction.
- Current TELGP application requirements, such as the need for a credit rating of "BB" or equivalent, present additional obstacles to tribes and should not be required.
- DOE should consider applicants with previous experience and implement greater use of milestone funding issued in tranches to control risks inherent in development activities.
- DOE should consider withdrawing the current solicitation and reissuing it with an application process like the Bureau of Indian Affairs Indian Loan Guarantee and Insurance Program.
- For interconnection to the grid through Western Area Power Administration (WAPA), DOE should provide grants or otherwise subsidize the costs of interconnection for tribal energy projects.
- DOE should investigate also what other forms of support can be made to increase access to the transmission through WAPA or other existing programs.
Question and Answers
Questions were submitted during the virtual event through a chat function.
A complete list of questions and DOE's responses is available. View the DOE Roundtable Discussion on Funding and Financing Tribal Energy Projects Questions and Answers.
DOE is continuing to review all questions and will provide further updates or changes to the IE and LPO programs as they are available.