| Comm. Renewable Energy Feasability Fund |
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| Background |
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The Oregon Department of Energy (ODOE) in coordination with the Oregon Department of Justice (DOJ) is directed by a Governor's Executive Order to establish the Community Renewable Energy Feasibility (CREF) program to support feasibility studies for "community renewable energy projects." The funding for this program has been made available to ODOE from the DOJ. The funds were obtained by the DOJ in settlements with Reliant Energy Inc. on claims arising out of the West Coast energy crisis of 2000 and 2001.
The CREF fund will be similar to the Renewable Energy Feasibility Fund (REF fund) administered by the Oregon Economic and Community Development Department (“OECDD”) but with broader eligibility criteria than the REF fund, including the ability to fund feasibility studies for private-sector entities. The CREF fund will utilize funds on a revolving basis, such that funding awarded to projects that are developed will be repaid by the developer and reallocated to future studies.
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| Program Objectives |
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The CREF fund has been established to support feasibility studies for community renewable energy projects and to encourage widespread development and utilization of Oregon’s many renewable energy resources. Our objective is to reduce Oregon's dependence on fossil-based energy sources and to promote sustainable economic development for communities throughout the state. By offering support to promising development projects early in the feasibility assessment, the CREF program will promote sound financial and engineering analysis for project development. The Program will minimize the financial insecurity faced by project developers who may be reluctant to invest in a feasibility study. CREF awards will not have to be re-paid if the project is not determined to be feasible.
What is a “feasibility study?”
A feasibility study for the purposes of the CREF program is an analytical tool that assists in determining the viability of a “community renewable energy project.” The study should entail a comprehensive analysis that provides the necessary information to determine if a development project is viable. It should evaluate all aspects of the project that together determine if the expectations of the project are likely to be met.
What type of feasibility study is eligible for funding?
Studies must be focused on developing a renewable energy construction project for the purpose of generating electricity, heat and/or fuel. Projects that would qualify as “Renewable Resource Project” under Oregon’s Business Energy Tax Credit (BETC) or State Energy Loan Program (SELP) may be considered for CREF funds. For electricity production, studies are limited to development projects that aim for capacity of more than 25kW and a maximum of 10MW. For heat and/or fuel generation projects, eligibility will be determined on a case by case basis with an emphasis on small-scale production. Further, the developer must be willing and committed to developing the construction project when it is appropriate to do so.
May “demonstration” projects or R&D projects qualify for the CREF Fund?
It is unlikely that pilot demonstration and/or R&D projects will qualify for funding under the CREF program. Preference will be given to projects with a high likelihood of being developed as construction projects. This criterion will favor feasibility studies that incorporate technologies with a demonstrated maturity in the marketplace or can provide definitive proof of commercial viability.
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| Eligibility |
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CREF program funds may be made available to any entity in Oregon that seeks funding for a feasibility study for a renewable energy project that will benefit Oregon energy consumers and communities. Eligibility is not limited by utility service territory. Entities eligible for CREF program awards may include but are not limited to:
- Privately-owned, for-profit entities
- Non-profit corporations
- Schools
- Special districts, e.g., as listed in ORS Chapter 198
- State agencies including agencies of higher education
- Councils of government
- Regional entities such as Metro
- Tribes
Municipal entities are eligible to apply for CREF funds, however applicants may be directed to the Renewable Energy Feasibility (REF) program administered by the OECDD. The REF program provides a similar funding structure to CREF but is targeted to renewable energy feasibility studies performed for municipally owned projects.
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| Funding |
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Limited funds will be made available on a competitive basis. There is currently a total of $500,000 to be allocated over a five year period with reimbursement payments to be added to the fund from successful development projects. Program application cycles will be announced twice annually. The amount of funding available for each application cycle will be determined by ODOE.
Is this a grant or a loan?
Award monies shall be disbursed from the CREF Program and administered via contract between the award recipient and ODOE. Although the awards under the Program shall not be designated as loans, the Program shall incorporate a mechanism for recovering funds from successful development projects. Award recipients that ultimately develop an energy project, the feasibility of which was evaluated with monies through the CREF program, will be required to repay the CREF Program award. The terms of potential award re-payments will be established in the contract between ODOE and the award recipients.
Is there a funding limit for a feasibility study?
Yes. The maximum award amount is $50,000 per study.
Is there a cost sharing requirement?
Yes. The applicant must provide a minimum of 25 percent of the total study costs. If the applicant secures federal funds, such as grants from USDA or US DOE, or other sources of funding, these may be applied to the total cost share of the applicant. Funds the applicant obtains from other State of Oregon agencies shall not be counted toward the 25% minimum cost share.
Do “in-kind” goods and/or services qualify for cost sharing?
Yes. “In-kind” contributions, such as consulting services, equipment, supplies, etc., that are needed to conduct the study may qualify for up to half of the applicant’s cost sharing requirement. This does not include project overhead costs, such as grant writing costs, contract administration, fringe benefits, office overhead, etc. ODOE will determine what qualifies as “in-kind” support as part of the application review process.
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| How and when to apply |
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A call for abstracts will be issued twice annually in the winter and summer. The first round will be announced in August 2008. Abstracts will be reviewed by ODOE staff to ensure project eligibility and to provide initial feedback to the applicant. Eligible applicants will be invited to submit a full proposal for consideration of an award. Abstracts should be submitted with the CREF pre application form. The specific timeline and application details will be made available on this web site during each funding round. This material can also be requested by contacting the program coordinator.
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| Selection Criteria |
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An Evaluation Committee comprised of a cross-section of state agency staff and external partners will rank the proposals based on the combined merits of each application relative to the pool of applications received. The Evaluation Committee will consider a number of factors in making ranking decisions, including but not limited to:
- Quality of project and likelihood to lead to construction.
- Potential energy and/or environmental benefit
- Potential cost benefit
- Economic development potential, e.g., impacts on jobs and revenue
- Creation of new or enhanced infrastructure to support business and community development
- Clearly defined deliverables and outcomes
- Viability of proposed technology solution
- Likelihood of project to satisfy BETC criteria, assuming project is feasible
- Demonstrated capability of project team
- Demonstrated need, e.g., preference to rural and distressed communities
- Amount of funding request (preference is to maximize the number of studies)
- Nature of project (preference is to maximize the overall diversity of projects)
- Clear and direct benefit to local community
- Availability of state funds to make awards
The Evaluation Committee reserves the right to recommend a downward adjustment to an award amount relative to an applicant’s request to better fulfill the mission of the CREF fund. In these instances, the committee and/or ODOE staff will work with the applicant to determine how to conduct the study with the adjusted award amount.
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| Awards and Fund Disbursement |
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Process and expected turn-around time for issuing awards
The approximate timeframe for the CREF fund process is as follows:
Abstracts
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Full Proposal
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Review
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Awards/Contracts
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Month 1
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Month 2
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Month 3-4
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Month 4
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As part of the abstract and proposal process, ODOE staff and the Evaluation Committee may request additional information from applicants. Under normal circumstances, awards will be announced approximately 45 days from the full proposal due date, and award recipients will be invited to enter into contractual agreement with ODOE. The contract process varies in length depending on the nature of the project, parties involved, competing demands on ODOE staff, etc., but the goal is to commence projects as soon as possible following the award announcements.
How will the money be disbursed?
Funds will be disbursed only after a contract is executed between the award recipient and ODOE. The specific terms will be included in the financing contract.
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| Study Ownership |
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Who will own the end product of the feasibility study?
The award recipient will own the study; however, ODOE will be given a copy of the final report and any requested work products as well as full, access to the study and any analysis performed to complete the study. Work products that are created using CREF funds are subject to public information laws. Provisions may be included to protect intellectual property rights, on a case-by-case basis.
What happens if a feasible project is not developed by the award recipient?
The award recipient will have a limited right of first refusal to use the results of the study for project development. However, once the time for such first refusal right expires, if an award recipient does not proceed with development of the project, ODOE may make the results of the study available to any entity with an interest in developing the project.
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| Question and Comments |
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Question and comments can be directed to:
Feasibility Program Coordinator
Robert Del Mar
Phone: 503-378-8607
Toll free within Oregon: 1-800-221-8035
Fax: 503-373-7806
robert.delmar@state.or.us
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