The Colorado Water Resources and Power Development Authority is offering $10 million in loans to new small hydropower projects of 5 MW or less.
The authority also is offering $150,000 in matching grants for evaluation and development of small hydropower projects.
Loan and grant applications both are due Oct. 15.
Colorado municipalities, water and sanitation districts, water conservation districts, irrigation districts, and any enterprise created by those entities are eligible to receive small hydropower loans.
Loans are limited to a maximum of $2 million per applicant. The interest rate is 2 percent, and the maximum term is 20 years. Annual loan repayments are to be structured to begin 12 to 18 months from the execution of the loan agreement, allowing for a full year of revenues before the first annual loan repayment is due.
The authority’s board of directors said it plans to first obligate funds for projects that are close to construction. Loan applications are considered on a �first in, first served� basis.
Once the board approves a loan, the borrower will have six months to execute it. If the borrower fails to execute the loan or to meet conditions imposed by the board within the six-month period, a new application with full review is required.
The organization identified items to be completed before execution of a loan agreement:
o A Federal Energy Regulatory Commission or Bureau of Reclamation exemption or permit is required;
o The applicant must have a contract to sell, or a plan to use within its system, the energy produced from the hydropower project;
o All required project funds must be in place;
o Final design and costs must be available with a construction contract imminent;
o The applicant must provide a feasibility study or cash flow statement demonstrating an ability to repay the loan; and
o Security for the loan, either through hydropower revenues or utility system revenues, must be in place.
The newly created Small Hydropower Loan Program is intended to complement renewable energy programs created by the Colorado Legislature in 2007 for biofuels, ethanol, wind, and solar power, the authority said.
Colorado offers grants for studies, design, permitting
The authority also will accept applications for matching grants for feasibility studies, permitting activities, or final design of potential hydropower projects. Applications will be reviewed by staff and grants awarded in early 2009.
For 2009, the authority said it would budget $150,000 for the matching grants. Matching grants of up to $15,000 will be available for each governmental agency. The authority’s board will review funding for matching grants annually beginning in 2010.
Loan and grant applications are due Oct. 15. Loan applications should be sent to Assistant Finance Director, Colorado Water Resources and Power Development Authority, 1580 Logan St., Suite 620, Denver, CO 80203. Grant applications should be submitted to Finance Director Michael Brod at the same address. Program information and application forms are on the authority’s Internet site, www.cwrpda.com. The address for the Small Hydropower Loan Program is www.cwrpda.com/shlpsubmenu.htm.