Frequently Asked Questions
About EDF's Title 17 Energy Financing Program, including the Energy Dominance Financing Program (EDFP)
Questions About Project Eligibility & Requirements
First, potential applicants should familiarize themselves with eligibility criteria described in the Title 17 Program Guidance. EDF’s team will next meet with potential applicants to evaluate best category and if EDF financing is a good fit for their project.
The Energy Dominance Financing Program (EDFP) can support projects that either: 1) retool, repower, repurpose, or replace Energy Infrastructure that has ceased operations; or 2) enable operating Energy Infrastructure to increase capacity or output; or 3) support or enable the provision of known or forecastable electric supply at time intervals necessary to maintain or enhance grid reliability or other system adequacy needs. (This category may apply to either brownfield or greenfield projects.) The scope of a project receiving EDF project financing may include remediation of environmental damage associated with Energy Infrastructure.
For illustrative purposes only, examples of project types that could be eligible for Energy Dominance Financing Program (EDFP) financing are available on pages 32-33 of the Title 17 Energy Financing Program Guidance.
EDF does not set a minimum loan size; however, due to administration priorities and some of the fixed costs associated with receiving a loan guarantee from EDF, loan guarantees are typically $500 million or more. EDF can guarantee up to 80% of eligible project costs, although project cashflows and credit risk considerations often lower leverage ratios with many projects ending up in the 40% to 60% range.
Projects seeking EDF financing under Title 17 must demonstrate that they involve technically viable and commercially ready technology. Commercially ready technology is defined as having been demonstrated at near commercial-scale under expected process conditions with results supporting the expected performance of the proposed deployment. Typically, this is the equivalent of achieving a technical readiness level 8. EDF can consider applications for projects at an earlier stage of development (i.e., a lower TRL level) if there is a clear path toward commercial readiness over the course of the application process. Applications will be denied if the proposed project is for research, development, or demonstration.
Applicants must demonstrate that their project has a reasonable prospect of repayment. In assessing reasonable prospect of repayment, EDF will consider the strength of the contractual terms of the project (if commercially reasonably available) and the forecast of noncontractual cash flows, among other considerations. Please see pages 47-50 (“Part II Evaluation Criteria”) of the Title 17 Energy Financing Program Guidance for additional information.
Pursuant to the Title 17 Part I application instructions, a front-end engineering and design (FEED) study is “encouraged for all projects” (see Part I Application Instructions). While it is not a requirement for entering or completing a Part I application, it can provide a useful summary of project requirements and demonstrate project readiness. If not received in the Part I application, EDF will encourage an applicant to provide a FEED study as part of a Part II application submission. A FEED study can support EDF’s assessment of a project’s reasonable prospect of repayment and is often considered a prerequisite for an Independent Engineer’s report (required in a Part II application, see Part II Application Instructions). In many cases, FEED studies can provide critical input to Engineering, Procurement, and Construction contracts and can inform site selection decisions. Inclusion of a FEED study in Part I can, therefore, facilitate EDF’s review of the application and accelerate the timeline for the overall application process.
The scope of a FEED study may need to be adjusted to reflect project characteristics. For example, in the case of a virtual power plant project, the information contained in a FEED study (scope, design/technical drawings, mechanical design, electrical design, costs and budget, etc.) will be required for any physical/hardware component of a virtual power plant (VPP) project. This could take the form of a traditional FEED study or something analogous that contains the necessary information. A similar level of rigor will be required for critical software components that need to be developed as part of the project.
In other cases, a FEED study may not be applicable in a Part I application. For example, where a regulated utility is proposing to undertake a portfolio of project investments over time. In these cases, EDF may require that the applicant or contracted developers provide planning documents and other project details for identified investments as part of the loan application process or loan documents.
Title 17 eligible Project Costs are defined at §609.10 of the Title 17 Regulations, and in the Title 17 Energy Financing Program Guidance (see “Loan Size and Eligible Project Costs” on pages 34-35). As stated in the Program Guidance, “Project Costs of an Eligible Project are those costs, including escalation and contingencies, that are expended or accrued by a Borrower and are necessary, reasonable, customary, and directly related to the design, engineering, financing, construction, startup, commissioning, and shakedown of an Eligible Project.” Note that expenses incurred after startup, commissioning, and shakedown of the facility as well as operating costs are not eligible for EDF financing.
Projects can qualify for Title 17 financing under the SEFI-supported project category if they are from a 1703 eligible technology category and receive meaningful financial support or credit enhancements from a State Energy Financing Institution (SEFI). A SEFI is an entity established by a State, or an Indian Tribal entity or Alaska Native corporation, to provide financing support or credit enhancements for eligible projects and to take steps to reduce financial barriers to the deployment of existing and new eligible projects. SEFI-supported projects are exempted from the innovation requirement, thereby expanding eligibility for EDF loan guarantees to projects that incorporate commercial technologies and aggregations of technology-diverse projects.
BABA requirements are described in the Title 17 Energy Financing Program Guidance (see Section E, “Federal Requirements”). These requirements apply if the Title 17 borrower is a “non-Federal entity.” States, local governments, Indian tribes, institutions of higher education, and non-profit organizations are considered “non-Federal entities”. As a general matter, for-profit organizations are not subject to BABA requirements. Consequently, BABA requirements would not apply to regulated utilities that are for-profit entities. The requirements may apply to municipal, co-op, or other non-profit utilities (state regulated or otherwise), for which EDF can advise on a case-by-case basis.
Generally speaking, EDF encourages prevailing wage paid on all aspects of a project. Compliance with Davis-Bacon prevailing wage is required beginning with the “construction, prosecution, or repair” of the project, “regardless of whether the closing of the DOE loan guarantee has occurred.” (See the Title 17 Energy Financing Program Guidance, Section E, “Federal Requirements.”) An exception to the Davis-Bacon prevailing wage requirements is contemplated for work conducted prior to contacting EDF if the Administrator of the Wage and Hour Division, Employment Standards Administration at the Department of Labor finds that there is no evidence of intent to apply for federal funding or assistance prior to the start of construction.
Questions About the Application Process & Loan Terms
Title 17 loan financing can be accessed by a wide range of entities. EDF has experience working with project developers, clean tech manufacturers and service providers, regulated utilities, public power entities, and independent power producers, among others.
Interested applicants are invited to request a pre-application consultation at any time. EDF’s staff will meet with potential applicants and provide step-by-step assistance to navigate the application process. Requestors should come prepared with a description of the proposed project and identified financing needs.
Potential applicants are encouraged to engage directly with EDF for no-fee, no-commitment consultations to start a conversation about the project and about EDF's process before formally applying. EDF encourages these inquiries to include relevant project details and likely project category to allow us to direct your inquiry to appropriate staff. Potential applicants should review publicly available information, including the Title 17 Energy Financing Program Guidance.
Applicants may apply for more than one Title 17 loan guarantee, but an applicant is limited to one application for an Innovative Energy or Innovative Supply Chain Project using a particular technology. An applicant may submit a single application for multiple projects using different technologies or at different sites; however, EDF may require the applicant to separate such projects into multiple applications at any time during the application process.
Title 17 Innovative Energy and Innovative Supply Chain projects are required to avoid, reduce, utilize, or sequester air pollutants or anthropogenic emissions of greenhouse gases. As part of the Part I Application, applicants must submit a Lifecycle GHG Emissions Data Worksheet to help EDF complete its lifecycle greenhouse gas emissions analysis of the proposed project (see the Program Guidance for exemptions and more information).
EDF is focused on project deployment, typically financing projects that are at later stage (ready for commercial deployment) than other DOE offices that focus on technology development or demonstration financial assistance programs. EDF provides long-term, senior debt for the construction of energy projects that may be challenged in obtaining adequate, flexible debt financing on competitive terms from private lenders. Unlike other DOE financial assistance programs, EDF’s process is not competitive. Applications may be submitted at any time and are not limited to an open solicitation period. The program is technology agnostic, and EDF will consider applications across sectors.
The timeline from application submission to EDF to conditional commitment can take anywhere from six months to more than a year, not including pre-application consultations. The process timeline is largely dependent on project maturity and the applicant’s preparedness and ability to provide required documents.
There are no application fees associated with submission of a Title 17 application. Applicants are responsible for third-party advisor costs, which typically begin in the due diligence phase. Applicants enter into sponsor payment letters with each third-party advisor costs and pay as these costs are incurred. These third-party expenses constitute Eligible Projects Costs and can be amortized in the loan itself. Additionally, applicants pay a facility fee and annual maintenance fees.
Please refer to the information pages 38-39 of the Title 17 Energy Financing Program Guidance.
EDF's loan guarantees can be stacked with clean energy tax credits, including energy production and investment tax credits. DOE cannot issue loan guarantees to projects that are expected to benefit from certain other forms of federal support (“Federal Support Restriction”), including grants, cooperative agreements, or other loan guarantees from federal agencies or entities. Please review page 58 of the Title 17 Energy Financing Program Guidance for detailed information on federal support restrictions.
Federal law requires that certain reviews and project requirements be met for a project to receive EDF support under Title 17, including: compliance with applicable environmental regulations, prevailing wage requirements, Cargo-Preference Act, and Build America, Buy America. Information about these requirements is available in the Program Guidance, and through consultation with EDF Staff.
Confidential business information shared with the Office of Energy Dominance Financing (EDF) is protected by Federal laws, regulations, and Department of Energy (DOE) policies.
DOE will allocate appropriated funds to pay the credit subsidy cost of a loan guarantee at the time DOE offers a conditional commitment, subject to the availability of appropriated funds. DOE anticipates having adequate appropriated funds to pay the credit subsidy costs of loan guarantees and will provide significant advance notice to the public and applicants if it expects to exhaust such appropriated funds. In that case, borrowers in the Title 17 program would be required to directly pay the credit subsidy cost prior to, or at the time of, the conditional commitment. For more information, see “Credit Subsidy Cost” on page 41 of the Title 17 Energy Financing Program Guidance.
The risk-based charge is determined based on the credit risk of the project. It is intended to make DOE’s charges closer, but not equal, to commercial markets. For loans issued by non-federal lenders but guaranteed by DOE, the interest rate will be described in the term sheet and may include a risk-based charge. The total interest rate may not exceed a level that the Secretary determines appropriate, taking into account the prevailing interest rate in the private sector for similar loans and risks. For more information, see “Interest Rate” on page 40 of the Title 17 Energy Financing Program Guidance.
Applicants can work with EDF to receive (1) a direct loan from U.S. Treasury’s Federal Financing Bank (FFB) backed by a 100% “full faith and credit” DOE guarantee through EDF or (2) an EDF partial guarantee of commercial debt from eligible private sector lenders. In both cases, applicants are responsible for certain third-party expenses, including the costs of third-party advisors retained by EDF; a non-refundable facility fee; and an annual maintenance fee.
DOE cannot finance projects that are expected to benefit from certain other forms of federal support, including grants, cooperative agreements, or other loan guarantees from federal agencies or entities. This so-called federal support restriction exists to ensure that an EDF loan is not repaid using other federal dollars. Federal support that pre-dates an EDF loan or that impacts an aspect of the project that is fully separate from the EDF loan may not trigger federal support restrictions.
Generally, companies or projects that have previously benefitted from federal support but no longer do (e.g., have exhausted the grant or repaid the loan in question) will not encounter federal support restrictions. If a company or project currently benefits from federal support, the applicant should evaluate whether this federal support impacts the same project or phases of a project for which the applicant is seeking EDF financing.
EDF staff will work with applicants to understand how federal support restrictions impact each potential project. DOE encourages potential applicants that may seek or anticipate federal support for a proposed project to arrange a pre-application consultation to better understand the potential impact to any loan guarantee issued under Title 17.
A third-party collateral appraisal is not required for a Part I or Part II application. However, in many cases, the final loan documents will require the delivery of a collateral appraisal on or prior to the project’s commercial operations date.