Billions of dollars in federal funds will be available to the private sector in contracts for the purchase of renewable energy.
“This is an end-of-the-game market creator for renewable energy and cleantech,” said Taite McDonald, a senior advisor at Wilson Sonsini Goodrich & Rosati (WSGR) in Washington, D.C. who advises energy and clean technology companies interested in working with government.
Opportunities are materializing. Earlier this month, the Army took an important step forward in laying the foundation to fulfill its commitment of deploying 1 GW of renewable energy. The Army Corps of Engineers released a call for companies to bid for up to $7 billion of contracts to purchase energy from renewable facilities that will be installed on military land.
The contracts –- in the form of power purchase agreements, or contracts that define the terms between buyers and sellers of electricity – could be in place for as long as 30 years. More likely, though, they’ll be 23 to 25 years in length, according to McDonald.
The number of contractors is dependent on the capabilities and qualifications of the bids the Army receives, said Hammack. It’s also dependent on the type of energy that’s supplied and the size of those projects. One gigawatt can be generated through 10 very large projects, 100 medium-sized projects or 500 small projects, according to Hammack.
The Navy is now soliciting feedback regarding what type of projects industry may want to build on its bases such as the Naval Air Weapons Station in China Lake, Calif. It’s planning to continue the process with other bases in the future, according to McDonald.
As for the Air Force, McDonald predicts it will likely start to release more opportunities for building renewable projects with enhanced-use leases in the coming months. The first step in the process to develop such an opportunity is now underway at the Ramey Air Force Base in Puerto Rico.
In the future, more requests for proposals focused on purchase power agreements are likely to become available, McDonald said.
Next page: Getting qualified under the Army’s $7 billion opportunity