DOE’s investments will support WEPCO in maintaining affordability for customers and meeting its public commitment to exit coal as a power generation source by the end of 2032.
December 13, 2024
minute read time
Jigar Shah
Former Director, Loan Programs Office
Jigar Shah served as Director of the Loan Programs Office (LPO) at the U.S. Department of Energy (DOE) from March 2021 to January 2025. He led and directed LPO’s loan authority to support deployment of innovative clean energy, advanced transportation, and Tribal energy projects in the United States. Prior, Shah was co-founder and President at Generate Capital, where he focused on helping entrepreneurs accelerate decarbonization solutions through the use of low-cost infrastructure-as-a service financing. Prior to Generate Capital, Shah founded SunEdison, a company that pioneered “pay as you save” solar financing. After SunEdison, Shah served as the founding CEO of the Carbon War Room, a global non-profit founded by Sir Richard Branson and Virgin Unite to help entrepreneurs address climate change.
Shah was also featured in TIME's list of the "100 Most Influential People" in 2024.
Originally from Illinois, Shah holds a B.S. from the University of Illinois-UC and an MBA from the University of Maryland College Park.
As part of the Biden-Harris Administration’s Investing in America agenda, the Department of Energy’s (DOE) Loan Programs Office (LPO) announced a conditional commitment for a loan guarantee of up to $2.5 billion for a portfolio of individual projects to Wisconsin Electric Power Company (WEPCO), a utility subsidiary of WEC Energy Group doing business as We Energies. WEPCO submitted its loan application to LPO in Summer 2023. If finalized, the guarantee will help finance the addition of more than 1,650 MW of utility-scale renewable power generation and energy storage projects in Wisconsin—reinforcing President Biden’s historic efforts to accelerate the deployment of affordable, reliable, and clean energy around the nation. Individual projects are expected to include investments in utility-scale wind, solar, energy storage, and hydropower, which taken together are expected to provide ratepayers a lower cost of energy over the long term compared to keeping end-of-life plants running.
Today’s announcement marks the first Energy Infrastructure Reinvestment (EIR) project under LPO’s flexible loan facility and disbursement approach tailored for regulated, investment-grade utilities. Electric utility borrowers for EIR projects must demonstrate that the financial benefits received from the DOE loan guarantee will be passed on to the customers of, or communities served by, that utility. LPO’s financing of the individual projects within the loan facility comes at a lower interest rate than traditional capital market financing, helping reduce upward pressure on electricity costs for WEPCO’s 1.1 million customers.
WEPCO’s workforce is represented by collective bargaining agreements with the International Brotherhood of Electrical Workers (IBEW) and Utility Workers Union of America (UWUA), in addition to other unions under multiple collective bargaining agreements. WEPCO updates union leaders on capital plans quarterly and hosts regular meetings at transitioning plants to keep labor informed. At full deployment, WEPCO’s investments are expected to support the creation of thousands of construction jobs and dozens of full-time positions—adding to the more than 16 million jobs created since President Biden and Vice President Harris took office.
LPO reviewed and performed an eligibility assessment and environmental review on one anchor project: the rehabilitation of WEPCO’s Big Quinnesec Falls hydropower facility. Through its due diligence approach to regulated utility lending, LPO confirmed that this individual project met all program eligibility requirements for inclusion in the guaranteed loan facility, illustrating WEPCO’s ability to identify and execute eligible projects.
Today’s announcement supports disadvantaged communities that are marginalized by underinvestment and overburdened by pollution. The closure of retiring coal facilities will reduce particulate matter, improving air quality for local communities. The distributed nature of WEPCO’s individual investments will also provide increased resiliency in the event of severe weather patterns, extending the benefits of WEPCO’s replacement investments across the more than 200 disadvantaged communities WEPCO serves.
LPO borrowers are required to develop and ultimately implement a comprehensive Community Benefits Plan (CBP). CBPs ensure borrowers meaningfully engage with community and labor groups to create good-paying jobs and improve the well-being of the local community and workers.
The Inflation Reduction Act of 2022 created the EIR category under the Title 17 Clean Energy Financing Program. EIR supports projects that retool, repower, repurpose, or replace energy infrastructure that has ceased operations, or that enable operating energy infrastructure to avoid, reduce, utilize, or sequester air pollutants or greenhouse gas emissions.
While this conditional commitment indicates DOE’s intent to provide a loan guarantee to finance the project, DOE and the company must satisfy certain technical, legal, environmental, and financial conditions before the Department enters into definitive financing documents and funds the loan.