A cabinet-level department recovered hundreds of millions of dollars in federal funding from an outdated renewable energy development that the previous administration supported.
The U.S. Department of Energy has successfully recouped about $200 million from a taxpayer-funded loan for Tonopah Solar Energy’s $1 billion Crescent Dunes Solar Energy Project, 226 miles northwest of Las Vegas.
The department and the proponent, Tonopah Solar Energy, achieved final settlement on July 30, 2020, which was about nine years after the Barack Obama administration supported the power plant that became obsolete before it even started operating. The matter is pending approval by the U.S. Bankruptcy Court in Nevada.
The amount represents 47 percent of the full $424 million Tonopah Solar owed. The department transferred the money back in 2011 and 2013, at least two years before Tonopah Solar Energy experienced several challenges.
A spokeswoman for Secretary of Energy Dan Brouillette revealed the project’s hot salt tanks caused an outage in 2016 that led to a nine-month shutdown. A further outage was reported in April 2019 and the plant has already been declared obsolete.
Department officials sent a default notice in September and the plant’s sole customer NV Energy, which is owned by Warren Buffett’s Berkshire Hathaway, ended its purchase agreement.
“This project has consistently faced technical failures that have proven difficult to overcome,” Director of Media Affairs Shaylyn Hynes told the Daily Caller. “The department’s decision was made after years of exhausting options within our authority to get the project back on track, given the significant taxpayer investment the prior administration committed to this project.”
Developer of the project SolarReserve described the operation as “moribund” and neither generating “energy nor revenue” with debts exceeding $440 million and assets worth “much less,” according to the Daily Caller.
Creditors and customers have criticized the proponent for mismanaging the unreliable plant, which the department took control of back in August 2019.
The plant was initially designed to produce enough electricity to supply a city with a population of 100,000 but this was never realized according to Bloomberg.
Tonopah Solar Energy’s decision to use custom parts and hire dozens of maintenance workers also meant its power cost about $135 per megawatt hour (MWh) to generate compared to more modern solar systems that can produce the same energy for just $30 per MWh.
Newer systems require much less time-consuming and labor intensive maintenance work, including occasionally water hosing the surface of solar panels to remove bird droppings, dust, leaves, and other contaminants that block sunlight from reaching the solar cells.