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DEFENSE COMMUNITIES 360

DOD to Issue Guidance on Financing Energy Projects, under Defense Bill

  • December 21, 2012
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The Defense Department will be required to issue guidance for selecting the financing approach for renewable energy projects, under a provision in the conference report for the fiscal 2013 defense authorization bill approved this week.

The guidance, which is due six months after the measure is enacted, “should describe the requirements and restrictions applicable to the underlying authorities and any Department of Defense-specific guidelines for using appropriated funds and alternative-financing approaches for renewable energy projects,” according to Section 2824 of the conference report.

Guidance on the selection of financing approaches should “ensure that business case analyses are completed to maximize cost savings and energy efficiency and mitigate drawbacks and risks associated with different financing approaches.”

The language directs the military services to adopt DOD’s guidance. The bill also calls for the department to create an information-sharing mechanism, such as a website, to provide installation officials timely access to information on the financing of renewable energy projects on other bases, along with best practices and lessons learned from past projects.

A separate provision, Section 2821, requires the department to notify Congress when it enters into a contract to construct and operate an energy plant on property owned by one of the services, if the transaction exceeds 20 years.

The House adopted the conference report for H.R. 4310 on Thursday, with the Senate expected to do the same Friday before it is sent to the president’s desk for his signature. The report, along with the joint explanatory statement, is available on the House Rules Committee website.

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