The Maryland Public Service Commission issued a May 23 order allowing Southern Maryland Electric Cooperative (SMECO) to guarantee, on behalf of affiliate SMECO Solar LLC, a loan for a recently-completed solar power project in Charles County, Md.
SMECO Solar will borrow up to $14.565m from the Federal Financing Bank (FFB), acting through the Administrator of the Rural Utilities Service (RUS).
The project to be refinanced is the 5.5-MW Herbert Farm Solar Project. SMECO will use these funds to pay down the bridge loan it acquired in October 2011 with the commission’s approval to build this project.
In September 2011, SMECO filed an application with the commission seeking loan approvals to establish an affiliate known as SMECO Solar LLC for the purpose of constructing and operating a 5.5 MW solar generating facility on SMECO property. The commission, in its October 2011 approval order, granted SMECO’s request for waivers regarding the construction of the facility owned and operated by SMECO Solar LLC with the following conditions:
- SMECO Solar LLC will not engage in other solar projects beyond the project at issue without further approval from the commission;
- Waivers contingent on the understanding that all of the output from the projects will be sold to SMECO. If there is any selling of the output to another party, all waivers are removed; and
- That the cooperative and SMECO Solar LLC will fully and properly allocate for all the costs.
Upon receiving commission’s approval, SMECO Solar completed the construction of this solar generation facility in November 2012, said a report from the PSC staff on this latest application. On April 17, SMECO filed for commission’s approval to guarantee a loan on behalf of SMECO Solar in the amount of $14.565m from FFB to refinance the costs of the construction for SMECO Solar’s new facility.