U.S. Energy Department’s loan office on Thursday closed a $3 billion partial loan guarantee for a project to provide more than 100,000 homeowners with rooftop solar units and batteries and allow them to feed power into the local electric grid.
Sunnova Energy’s (NOVA.N) Project Hestia will give out loans to 75,000-115,000 homeowners throughout the U.S. to enable them to install rooftop solar, home battery systems and smart energy software that helps them use energy efficiently, the DOE said.
The project could potentially avoid 7.1 million tonnes of carbon dioxide emissions and generate 568 megawatts (MW) of emissions-free power over 25 years, it added.
Equipping homes with smart software and home energy generation can allow Sunnova to make them into Virtual Power Plants (VPP), networks of small energy-producing or storage devices that are pooled together to serve the electricity grid.
The Energy Department said on Thursday that this is the single largest commitment ever made by the U.S. government to solar power, and the DOE’s first loan guarantee for a VPP.
Project Hestia would target lower income homeowners and could create as many as 3,400 jobs, the Energy Department said.
VPPs have been on the rise in the U.S. since the Federal Energy Regulatory Commission in 2020 allowed them to compete in wholesale power markets.
They are also being used in Australia, Japan and Europe by companies including Statkraft (STATKF.UL), Shell-owned (SHEL.L) Next Kraftwerke, and Tesla Inc.