Obama approves $1.85bn of solar funding in job creation push

President Barack Obama has once again underlined the crucial role that low carbon technologies will play in leading the US out of recession, using his weekly address on Saturday to announce nearly $2bn (£1.3bn) in loan guarantees to two large-scale solar energy projects, which combined are expected to create up to 5,000 jobs.

Obama said the Department of Energy will this week approve $1.85bn in loan guarantees as part of the government's economic stimulus package, citing the move as evidence that the administration is "accelerating the transition to a clean energy economy and doubling our use of renewable energy sources such as wind and solar power – steps that have the potential to create whole new industries and hundreds of thousands of new jobs in America".

Spanish renewable energy firm Abengoa Solar is to receive $1.45bn in loan guarantees to help support the development of its proposed Solana solar farm near Gila Bend, Arizona, which is expected to generate enough power for around 70,000 homes.

Obama insisted that the project would provide a major boost for the US economy, while also providing the country's first solar plant capable of storing energy and generating power overnight.

A further $400m in loan guarantees will be provided to Colorado-based Abound Solar Manufacturing to help support the development of two new solar panel manufacturing plants, which are expected to create 2,000 construction jobs and 1,500 permanent jobs.

Obama said that the loan guarantees were the latest in a long line of clean energy investments made under the US Recovery Act, which he argued were already creating jobs and helping to bolster US competitiveness.

"Already, I've seen the payoff from these investments," he said. "I've seen once-shuttered factories humming with new workers who are building solar panels and wind turbines; rolling up their sleeves to help America win the race for the clean energy economy."

The announcement comes just weeks after the Department of Energy (DoE) said its energy efficiency investment programme is also bearing fruit.

The Department announced last month that 12 states had already completed weatherisation work (which protects buildings from the elements and can also include insulation and energy efficiency improvements) on more than 30 per cent of the homes they had earmarked for makeovers as part of the Weatherisation Assistance Programme. The milestone allows the states to access the remaining 50 per cent of the funding available to them under the programme.

The scheme has been criticised in some quarters for getting off to a slow start, but the DoE said that the initiative has now weatherised more than 108,000 homes nationally, saving American families more than $47m on their energy bills and supporting more then 10,000 jobs in the first quarter of this year.

The Department also announced last month that it has approved a further $76m in funding to support advanced energy efficient building technology projects and the development of new training programmes for commercial building equipment technicians, building operators, and energy auditors.