May 12 (Bloomberg) -- First Solar Inc., the world’s largest maker of thin-film solar modules, received letters indicating support from the U.S. Energy Department for three projects it’s developing in California.
The letters mean that loan guarantees are moving forward on First Solar’s Topaz and Desert Sunlight projects, which will each have 550 megawatts of capacity, and its 230-megawatt Solar Ranch project, the Tempe, Arizona-based company said on its website.
“These letters are a positive development for First Solar as it reaffirms that the company’s largest projects remain on track,” Mark Bachman, an analyst at Auriga USA in New York, said today in a note to clients. He has a “buy” rating on First Solar shares.
The Energy Department has approved, with conditions, 19 loan guarantees for renewable energy projects, accounting for almost two-thirds of the $2.4 billion in funding that was approved as part of the Recovery Act. The agency must distribute all the funds before the loan guarantee program expires at the end of September.
Jonathan Silver, director of the Energy Department’s loan program, on May 10 said there won’t be enough money or time to complete financing for every project that submitted applications, and that some won’t receive its backing. The projects the agency deems most likely to succeed will have priority, he said.
First Solar’s 290-megawatt Agua Caliente project in Arizona, which is being built for NRG Energy Inc., in January won approval for a loan guarantee of as much as $967 million.
First Solar rose $5.20, or 4.2 percent, to $129.50 at 10:32 a.m. in Nasdaq Stock Market trading. The shares have declined 9.9 percent in the past month.
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