SunPower Corporation (SPWRA) announced that it received a conditional loan guarantee of $1.187 billion from the U.S. Department of Energy (DOE) for its 250 Megawatt (MW) California Valley Solar Ranch power plant. Once completed this photovoltaic (PV) solar power plant will be one of the largest in the world.

The work on this project is expected to start in the second half of 2011. The solar plant is partially expected to begin operations by the end of 2011 with the balance coming on line in 2012 and 2013.

This project once completed will provide power to 100,000 homes and will be a contributor to the state of California’s effort to generate 33% of its electricity from renewable sources by 2020.

NRG Solar, a unit of NRG Energy Inc. (NRG), has plans to invest $450 million in equity in the project in the next four years and assume ownership and financing responsibilities, subject to certain conditions.

Recently, SunPower completed a 19 MW solar power plant in Colorado’s Alamosa County. The plant will supply solar power to Xcel Energy Inc. (XEL).

On its part, the DOE continues to support clean energy projects. It has committed to support 21 projects with loan guarantee exceeding a substantial $19 billion. Recently, DOE provided a loan guarantee of $1.6 billion for the three-plant Ivanpah Solar Energy Generating System, located in Southeastern California. BrightSource Energy will complete construction of a solar energy facility with a gross generating capacity of 392 MW.

We appreciate SunPower’s efforts in investing in renewable projects, fueled by a quest to generate more power from green sources rather than depending on fossil fuels that are guilty of adding to green house gas emissions.

SunPower currently has a short-term Zacks #2 Rank (short -term Buy rating). We maintain our Outperform recommendation on SunPower shares over the long term.

San Jose, California based SunPower Corporation designs, develops, manufactures, markets and sells high-performance solar electric power technology products, systems and services worldwide for residential, commercial and utility-scale power plant customers.

 
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