Beacon Power Moves into Next Stage of DOE Loan Guarantee Process for 20-MW Flywheel Regulation Plant

Beacon Power Corporation, a company that designs and develops advanced products and services to support more stable, reliable and efficient electricity grid operation, has delivered the last of nearly 100 separate documents in its application for a loan guarantee to the U.S. Department of Energy’s Loan Guarantee Program Office and moved into the next stage of the process.

“We have been informed by the Loan Guarantee Program Office that we are now in the due diligence phase in the process. This is another important milestone on the path to building our first 20-MW frequency regulation plant in Stephentown, New York,” said Bill Capp, Beacon president and CEO. “The DOE’s information requirements were comprehensive, rigorously detailed and demanding, and our team did an excellent job in completing and submitting them all in a timely manner. We applaud DOE’s efforts to help bring clean tech solutions like Beacon’s flywheel regulation technology to commercial use. We look forward to completion of the DOE’s review and to its subsequent decision.”

Among the remaining elements in the process that the Company anticipates are completion of due diligence by DOE; review by the DOE Credit Review Board; the issuance of a term sheet to Beacon Power; and negotiation of a loan guarantee agreement. The loan associated with this program would provide the majority of financing for Beacon’s proposed 20-megawatt regulation plant in Stephentown.

Loan Guarantee Program Seeks to Aid Commercialization of New Technologies

The DOE’s Loan Guarantee Program was established pursuant to Title XVII of the Energy Policy Act of 2005. The Act authorized DOE to make loan guarantees for projects that “avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases; and employ new or significantly improved technologies as compared to commercial technologies in service in the U.S. at the time the issuance is guaranteed.” The purpose of the Program is to expedite the deployment of new energy technology into commercial use in the U.S. and to reduce emissions of greenhouse gases and other air pollutants.

Beacon Power’s proposed 20-MW regulation plant is based on non-polluting, flywheel-based energy storage technology that can provide the services now performed by conventional fossil-fuel regulation methods in a cleaner, faster and more cost-effective way. In October 2007, of 143 pre-application submissions, Beacon’s project was one of just 16 invited to submit an application for loan guarantee consideration. Of these 16 projects, Beacon’s is the only one selected in the “Electricity Delivery and Energy Reliability” category.