Rep. Leger Fernández Introduces Bill To Expand Tribes' Access to Loans For Energy Development

Statement

Congresswoman Teresa Leger Fernández (D-NM) introduced the bipartisan Tribal Energy Investment Act of 2022 to allow the Department of Energy (DOE) to make direct loans to Indian tribes and tribal energy development organizations for energy development projects.

She is sponsoring this legislation with Reps. Cole (R-OK), O'Halleran (D-AZ), and Davids (D-KS).

"Our Tribes can develop the energy they need if we remove the obstacles to their success," said Leger Fernández. "My bill will improve tribes and tribal entities' ability to finance energy projects, which will help power our Native communities while creating economic opportunity. By investing in tribal energy potential, we can expand clean energy, improve energy security, and generate jobs."

"This spring, I hosted Department of Energy Secretary Granholm in Arizona's First District, where we toured several successful tribal energy projects including the Kayenta Solar Farm. As our energy economy evolves, tribal communities need a seat at the table," said O'Halleran, who represents the district with the most Native Americans living on reservations in the country. "I'm proud to join my colleagues to introduce this commonsense measure that helps to better invest in tribal energy potential, ensuring that sovereign tribes have the resources they need to expand clean energy projects and achieve their energy goals."

"The Tribal Energy Loan Guarantee Program helps tribes access the capital necessary for much needed energy projects. Direct loan authority gives Indian Country the ability to develop their local economies in ways they weren't able to before. Congresswoman Leger Fernandez's bill makes this authority permanent which is a giant step in the right direction to help maximize future economic potential for Tribal communities." said Rico Frias, Executive Director for the Native American Finance Officers Association.

"We appreciate and support the legislation sponsored by Rep. Teresa Leger Fernández to build on the fine work that the U.S. Department of Energy (DOE) Loans Program Office, after listening to Indian Country and incorporating many of our suggestions into the Tribal Energy Loan Guarantee Program as announced at the 2022 Reservation Economic Summit. These changes, made possible by temporary provisions the Congresswoman supported in the final FY2022 funding measure for DOE, are designed to eliminate costly upfront fees that have proved to be a barrier to entry for many tribes and Native entities, and open eligibility to a broad range of project types. The updates also take important steps for direct lending to tribes and Native entities. We look forward to continuing to work with Rep. Leger Fernández on her legislation to make permanent changes to the program and with the Loans Program Office to ensure that its programs work for the communities we serve." said Chris James, President & CEO of The National Center for American Indian Enterprise Development.

Background

Currently, DOE's Tribal Energy Loan Guarantee Program (TELGP) can provide loan guarantees up to 90% of any loan made to federally recognized tribes or tribal entities, including Alaska Native Corporations, for energy development projects. Even with the loan guarantee, however, private lenders are often unwilling to work with tribes and tribal organizations on energy projects. Moreover, DOE cannot make direct loans to tribes and tribal entities through the program outside of fiscal year 2022. This makes it difficult for tribes to obtain necessary financing for energy projects. The Tribal Energy Investment Act builds upon recent updates DOE made to improve tribes' access to financing.

The Tribal Energy Investment Act of 2022 would:

Amend the Energy Policy Act of 1992 to allow the DOE to make direct loans to tribes and tribal energy development organizations through the Federal Financing Bank.
Allow DOE to use funds previously appropriated for the cost of loan guarantees for the cost of direct loans.
The Tribal Energy Investment Act of 2022 is supported by the National Congress of American Indians, National Center for American Indian Enterprise Development, Native American Finance Officer Association, and the Navajo Nation.

The House Committee on Energy and Commerce is scheduled to hold a hearing on the bill next Wednesday, June 22, 2022.

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