42 U.S.C. § 16511 — Definitions

Page 8909 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 16511 (c) Requirements An applicant for a loan guarantee under this section may provide assurances, satisfactory to the Secretary, that— (1) the project design has been validated through the operation of a continuous process facility; (2) the project has been subject to a full technical review; (3) the project, with the loan guarantee, is economically viable; and (4) there is a reasonable assurance of repay- ment of the guaranteed loan. (d) Limitations (1) Maximum guarantee Except as provided in paragraph (2), a loan guarantee under this section— (A) may be issued for up to 80 percent of the estimated cost of a project; but (B) shall not exceed $50,000,000 for any 1 project. (2) Additional guarantees (A) In general The Secretary may issue additional loan guarantees for a project to cover— (i) up to 80 percent of the excess of ac- tual project costs; but (ii) not to exceed 15 percent of the amount of the original loan guarantee. (B) Principal and interest Subject to subparagraph (A), the Secretary shall guarantee 100 percent of the principal and interest of a loan guarantee made under subparagraph (A). (Pub. L. 109–58, title XV, § 1516, Aug. 8, 2005, 119 Stat. 1091.) Editorial Notes REFERENCES IN TEXT Title XIV, referred to in subsec. (a), is title XIV of Pub. L. 109–58, Aug. 8, 2005, 119 Stat. 1061, which enacted subchapter XIII of this chapter and section 13557 of this title. SUBCHAPTER XV—INCENTIVES FOR INNOVATIVE TECHNOLOGIES § 16511. Definitions In this subchapter: (1) Commercial technology (A) In general The term ‘‘commercial technology’’ means a technology in general use in the commer- cial marketplace. (B) Inclusions The term ‘‘commercial technology’’ does not include a technology solely by use of the technology in a demonstration project fund- ed by the Department. (2) Cost The term ‘‘cost’’ has the meaning given the term ‘‘cost of a loan guarantee’’ within the meaning of section 661a(5)(C) of title 2. (3) Eligible project The term ‘‘eligible project’’ means a project described in section 16513 of this title. (4) Guarantee (A) In general The term ‘‘guarantee’’ has the meaning given the term ‘‘loan guarantee’’ in section 661a of title 2, except that a loan guarantee may guarantee any debt obligation of a non- Federal borrower to any Eligible Lender (as defined in section 609.2 of title 10, Code of Federal Regulations). (B) Inclusion The term ‘‘guarantee’’ includes a loan guarantee commitment (as defined in sec- tion 661a of title 2). (5) Obligation The term ‘‘obligation’’ means the loan or other debt obligation that is guaranteed under this section. (6) State The term ‘‘State’’ has the meaning given the term in section 6802 of this title. (7) State energy financing institution (A) In general The term ‘‘State energy financing institu- tion’’ means a quasi-independent entity or an entity within a State agency or financing authority established by a State— (i) to provide financing support or credit enhancements, including loan guarantees and loan loss reserves, for eligible projects; and (ii) to create liquid markets for eligible projects, including warehousing and securitization, or take other steps to re- duce financial barriers to the deployment of existing and new eligible projects. (B) Inclusion The term ‘‘State energy financing institu- tion’’ includes an entity or organization es- tablished to achieve the purposes described in clauses (i) and (ii) of subparagraph (A) by an Indian Tribal entity or an Alaska Native Corporation. (Pub. L. 109–58, title XVII, § 1701, Aug. 8, 2005, 119 Stat. 1117; Pub. L. 117–58, div. D, title IV, § 40401(c)(1), Nov. 15, 2021, 135 Stat. 1037; Pub. L. 117–169, title V, § 50141(e), Aug. 16, 2022, 136 Stat. 2043.) Editorial Notes AMENDMENTS 2022—Par. (4)(A). Pub. L. 117–169 inserted ‘‘, except that a loan guarantee may guarantee any debt obliga- tion of a non-Federal borrower to any Eligible Lender (as defined in section 609.2 of title 10, Code of Federal Regulations)’’ before period at end. 2021—Pars. (6), (7). Pub. L. 117–58 added pars. (6) and (7). Statutory Notes and Related Subsidiaries WAGE RATE REQUIREMENTS For provisions relating to rates of wages to be paid to laborers and mechanics on projects for construction, alteration, or repair work funded under div. D or an amendment by div. D of Pub. L. 117–58, including au- thority of Secretary of Labor, see section 18851 of this title. Page 8910 TITLE 42—THE PUBLIC HEALTH AND WELFARE § 16512 § 16512. Terms and conditions (a) In general Except for division C of Public Law 108–324 [15 U.S.C. 720 et seq.], the Secretary shall make guarantees under this or any other Act for projects, including projects receiving financial support or credit enhancements from a State en- ergy financing institution, on such terms and conditions as the Secretary determines, after consultation with the Secretary of the Treasury, only in accordance with this section. (b) Specific appropriation or contribution (1) In general Except as provided in paragraph (2), the cost of a guarantee shall be paid by the Secretary using an appropriation made for the cost of the guarantee, subject to the availability of such an appropriation. (2) Insufficient appropriations If sufficient appropriated funds to pay the cost of a guarantee are not available, then the guarantee shall not be made unless— (A) the Secretary has received from the borrower a payment in full for the cost of the guarantee and deposited the payment into the Treasury; or (B) a combination of one or more appro- priations and one or more payments from the borrower under this subsection has been made that is sufficient to cover the cost of the guarantee. (3) Source of payments The source of a payment received from a borrower under subparagraph (A) or (B) of paragraph (2) may not be a loan or other debt obligation that is made or guaranteed by the Federal Government. (c) Amount Unless otherwise provided by law, a guarantee by the Secretary shall not exceed an amount equal to 80 percent of the project cost of the fa- cility that is the subject of the guarantee, as es- timated at the time at which the guarantee is issued. (d) Repayment (1) Requirement (A) In general No guarantee, including a guarantee for a project receiving financial support or credit enhancements from a State energy financing institution, shall be made unless the Sec- retary determines that there is reasonable prospect of repayment of the principal and interest on the obligation by the borrower. (B) Reasonable prospect of repayment The Secretary shall base a determination of whether there is reasonable prospect of repayment under subparagraph (A) on a comprehensive evaluation of whether the borrower has a reasonable prospect of repay- ing the guaranteed obligation for the eligi- ble project, including, as applicable, an eval- uation of— (i) the strength of the contractual terms of the eligible project (if commercially reasonably available); (ii) the forecast of noncontractual cash flows supported by market projections from reputable sources, as determined by the Secretary; (iii) cash sweeps and other structure en- hancements; (iv) the projected financial strength of the borrower— (I) at the time of loan close; and (II) throughout the loan term after the project is completed; (v) the financial strength of the inves- tors and strategic partners of the bor- rower, if applicable; and (vi) other financial metrics and analyses that are relied on by the private lending community and nationally recognized credit rating agencies, as determined ap- propriate by the Secretary. (2) Amount No guarantee shall be made unless the Sec- retary determines that the amount of the obli- gation (when combined with amounts avail- able to the borrower from other sources) will be sufficient to carry out the project. (3) Subordination The obligation shall be subject to the condi- tion that the obligation, including any reorga- nization, restructuring, or termination there- of, shall not at any time be subordinate to other financing. (e) Interest rate An obligation shall bear interest at a rate that does not exceed a level that the Secretary deter- mines appropriate, taking into account the pre- vailing rate of interest in the private sector for similar loans and risks. (f) Term The term of an obligation shall require full re- payment over a period not to exceed the lesser of— (1) 30 years; or (2) 90 percent of the projected useful life of the physical asset to be financed by the obli- gation (as determined by the Secretary). (g) Defaults (1) Payment by Secretary (A) In general If a borrower defaults on the obligation (as defined in regulations promulgated by the Secretary and specified in the guarantee contract), the holder of the guarantee shall have the right to demand payment of the un- paid amount from the Secretary. (B) Payment required Within such period as may be specified in the guarantee or related agreements, the Secretary shall pay to the holder of the guarantee the unpaid interest on, and unpaid principal of the obligation as to which the borrower has defaulted, unless the Secretary finds that there was no default by the bor- rower in the payment of interest or principal or that the default has been remedied. (C) Forbearance Nothing in this subsection precludes any forbearance by the holder of the obligation