As the Department of Energy's Loan Guarantee program continues to inch along, more visibility is emerging on how much economic activity it will spur. A total of $15 billion worth of projects could be financed through the new FIPP structure, which stands for Financial Institution Partnership Program, and requires that renewable energy project developers arrange financing through private banks prior to applying for the loan guarantee. This allows the DOE to streamline and hasten the application process. However, only tried and true technologies need apply for the FIPP guarantees, as few banks would be willing to take a flier on emerging technologies that haven't been tested in the field for years or decades. 

Thus the primary winner of FIPP guarantees will probably be wind power projects, since that technology already has amassed a long track record of successful implementation. And according to Ken Hansen, a partner at law firm Chadbourne & Parke, the $750 million could be stretched out to subsidized more than $15 billion worth of projects, assuming a 5% credit subsidy. Hansen was speaking at a Chadbourne & Parke-sponsored webcast about the loan guarantee program.

All of this isn't to say that emerging technologies, like solar thermal and photovoltaic plants, won't also get their chance to get guarantees. They will be eligible for a separate $2.5 billion bucket of credit subsidies which are designed to guarantee projects utilizing "innovative technologies". Assuming that the average credit subsidy for such projects will be set at 10%, that means that another $25 billion worth of projects will be enabled through the loan guarantee program. That's a grand total of $40 billion worth of economic activity, all made possible for the low, low price of $3.25 billion in government subsidies.