The U.S. Department of Energy (DOE) has cancelled a $2.92 billion loan guarantee previously committed to residential solar company Sunnova.
Originally disclosed in 2023, the loan guarantee has been “de-obligated,” thus removing the requirement for the federal government to continue financing. It was the first loan guarantee designated for Virtual Power Plants (VPPs) and could have resulted in the buildout of 568 MW of solar and storage capacity.
The former terms of the loan guaranteed up to 90% of $3.3 billion in term loans to support Sunnova’s “Project Hestia,” which aimed at expanding distributed energy resources (DERs) like rooftop solar, battery storage, and VPP-ready software.
Prior to the loan cancellation announcement, Sunnova had been struggling financially. According to reports, the company skipped a bond interest payment to the tune of $400 million earlier this year.
Additionally, the company saw its shares fall 71% in March.