Biden’s Transition Loan Rush Hits $38 Billion

A rush by the Department of Energy to distribute as many transition loans as possible before Trump takes office has resulted in over $38 billion in loans being issued since the November elections. For context, the total commitments since the passing of the IRA have amounted to $54 billion in loans and loan guarantees.

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The Financial Times reported the number, noting that some of the allocations rank among the largest in history. By far the biggest is the $15 billion that the Department of Energy’s Loan Programs Office granted to Pacific Gas and Electric to upgrade its infrastructure. This is the largest LPO loan ever granted.

Among the other large commitments by the LPO the FT listed a $7.54-billion loan to Samsung and Stellantis for a battery plant in Indiana, a $6.57-billion loan to electric car maker Rivian, which is also backed by Amazon, and a $4.9-billion commitment to transition tech major Invenergy for the construction of a transmission line.

This last-moment rush to distribute money to transition projects may not do much, however, as some in the Trump camp have already warned that the distributions would be scrutinized. Specifically, Vivek Ramaswamy, the co-chair of the Department of Government Efficiency, said this month that “DOGE will carefully scrutinize every one of these questionable 11th-hour transactions.”

“It’s a pretty good expectation that the LPO will be on the target list,” Kevin Book, co-founder of research group ClearView Energy Partners, told the Financial Times. “That gives the outgoing administration an incentive to try to lock in as many loan guarantees and funding actions as they can.”

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Yet some potential grant takers have taken a step back from trying to secure funds from the LPO in anticipation of Trump’s inauguration. The DoE’s loan office has a firepower of $400 billion, most of which has yet to be committed.

By Irina Slav for Oilprice.com

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