NRG Energy Jumps Into Flagship BrightSource Solar Farm

If you were wondering how solar thermal startup BrightSource was going to get its flagship solar project in the California desert built (well, after that whole DOE loan guarantee thing), here’s how: Power company NRG Energy (s NRG) said this morning it will invest $300 million into the solar farm over three years and will partner with BrightSource to construct, own and operate Ivanpah.

NRG’s timing to take over a chunk of the project isn’t a coincidence. Over the past several weeks and months, Ivanpah became one of the first of a wave of solar projects to receive approval from the California Energy Commission as well as the Federal Bureau of Land Management. Until recently, the project — BrightSource’s planned first of over a dozen — had been in regulatory purgatory for close to three years.

Ivanpah is planned to be a massive 392-MW solar farm built next to the Ivanpah Dry Lake, in San Bernardino County, Calif., and will be the first of its kind to use BrightSource’s solar thermal concentrating gear to tap into the sun’s heat to provide electricity for 140,000 homes. Construction has already started on Ivanpah, and solar electricity from the farm is supposed to turn on in 2013.

BrightSource, and its Ivanpah project in particular, have already effectively raised a lot of funding. There was the $1.37 billion loan guarantee commitment from the DOE specifically to build Ivanpah. A loan guarantee serves essentially as a promise by the government to make good on a loan if the company can’t, and typically enables better interest rates and lower costs than would otherwise be available to a company for project financing.

Then there’s the planned $215.5 million Series D round of equity and options funding, of which BrightSource has raised about $176 million so far. That round included investors Draper Fisher Jurvetson, Morgan Stanley, VantagePoint Venture Partners, and new investor Alstom (a provider of equipment and services for power generation), which will become “one of the main shareholders” in BrightSource. The finance arm of construction giant Bechtel has also taken an equity stake in Ivanpah.

There’s also been a lot of talk about an IPO for BrightSource, which hasn’t confirmed publicly such a plan. But two people close to the company did tell Dow Jones VentureWire that BrightSource has hired Morgan Stanley and Goldman Sachs to prepare for an IPO that is likely to take place next year.

Despite that wealth of funding, it was clear that the company needed to raise even more to get Ivanpah fully constructed, as well as to fulfill the rest of BrightSource’s commitment to deliver 2.6 gigawatts total to the Pacific Gas and Electric and Southern California Edison (Ivanpah is part of this commitment). That’s where NRG comes in, adding $300 million into the project pool. The commitment is testament to just how much funding these types of solar projects require.

NRG, for its part, has been investing in solar in spades. It owns the largest PV solar project in California, and has a total solar project pipeline of 1,150 MW.

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