On Tuesday, the Department of Energy issued draft rules for its new “Energy Dominance Financing Program,” and established that the Loan Programs Office will stop requiring emissions curtailment and community outreach efforts for projects seeking loans.
On Wednesday, LPO finalized its second deal under that new program, which was created under the GOP’s “One Big Beautiful Bill.” And the now-final $1.5 billion loan guarantee to Wabash Valley Resources, which was conditionally committed by the Biden administration in September 2024, now has a distinctly Trumpian twist: The fertilizer production project will now use coal from a nearby mine as feedstock.
“For too long, America has been dependent on foreign sources of fertilizer,” Energy Secretary Chris Wright said in a statement about the loan. “Under President Trump’s leadership, we are changing that by putting America first, relying on American coal, American workers, and American innovation to power our farms and feed our families.”
The project, in West Terre Haute, Indiana, was originally designed to produce low-carbon ammonia fertilizer by bringing an industrial gasifier — a machine used to convert solid materials into gas — back online. When the conditional commitment was first announced, it was framed as “the world’s first, carbon-negative ammonia production facility.” At the time, WVR said it intended to use petcoke (a waste product from the oil refining process) as feedstock, while permanently storing carbon dioxide.
But finalizing the loan required adjusting to the priorities of the new administration, said Pete Simmons, WVR’s VP of Government Relations. “The Trump administration asked us to use a feedstock blend that uses coal to support the administration’s Energy Dominance strategy,” Simmons told Latitude Media in an email. Yesterday’s loan closing announcement also did not include mention of carbon dioxide capture or sequestration.
The change will not impact the economics or the timeline of the project, Simmons added, because the gasifier is fuel-flexible.
Energy Dominance Financing
Under the Biden administration, the loan guarantee originated through the Energy Infrastructure Reinvestment Program. In July, OBBB rescinded loan authority for that program under the Inflation Reduction Act, as well as its remaining credit subsidy. Instead, the legislation repurposed EIR into a new financing initiative, and the Energy Dominance Financing program was born.
That program takes a more expansive approach to what qualifies as “energy infrastructure” for the purposes of LPO loans, via “new eligibility for clean coal and oil and gas power-generated projects” as well as critical minerals supply chain projects.
It also removes the prior requirement that eligible projects “avoid, reduce, utilize, or sequester air pollutants or anthropogenic emissions of greenhouse gasses.” In its draft rulemaking released this week, DOE explained that loan guarantees and stakeholders “may change behavior given the material change of the type of project eligible.” Industry may be willing to “undertake different projects than they did prior to the rule,” the agency added.
There’s significant pressure on projects in LPO’s pipeline that hadn’t finalized their loans before the administration handover, said Kyle Winslow, a former senior advisor to the office. “There’s a shot clock on these conditional commitments,” Winslow explained on a Latitude Dispatch last week.
For projects that fit in with stated administration priorities like national security, recent activity out of the office is a positive sign that there’s a path to closing, he added. That may be in part thanks to political pressure; members of Congress on both sides of the aisle are increasingly issuing public statements wanting to know the status of these projects, on behalf of constituents and powerful companies operating out of their states and districts.
“It does send a strong and direct signal to the administration that the office, and projects in some of these sectors that we can see eye to eye on, do seem to have common bipartisan support,” Winslow added. “Folks want to see projects move and jobs in those districts and states.”
According to WRV’s September 2024 press release, the project is expected to create 500 construction jobs and 125 operations jobs in West Terre Haute.
