On Thursday, the loan office of the United States Department of Energy announced that it will be providing 24.92 billion dollars in conditional financing to a number of energy utilities located in a dozen different states.

In the event that the finance is finalized, it will be obtained through the energy infrastructure reinvestment program that is housed inside the Loan Programs Office (LPO) of the department, as The Daily Caller reported.

This program was established as a result of the Inflation Reduction Act, which is President Joe Biden's flagship piece of climate legislation.

Money Usage

Projects that retool or replace energy infrastructure that has stopped running or that permit reductions in emissions that are blamed for global warming are eligible for the program's guarantee of loans.

It is expected that this would be one of the final rounds of financing under the Biden administration before Donald Trump takes office on January 20.

The LPO is responsible for administering more than $385 billion in low-interest loans to businesses that are working on green energy projects such as advanced automobiles, nuclear power, and batteries.

LPO made an announcement last month that it would offer a conditional loan of up to $15 billion to the utility company PG&E (PCG.N), which is situated in California.

Why It's Important

The future of the LPO is unknown under Trump's administration.

Two utility companies of DTE Energy Company, which is situated in Detroit, Michigan, obtained as much as $8.8 billion in financing.

In addition to funding the installation of renewable energy sources, the money will be used to rebuild pipelines in order to limit the number of gas leaks.

The Consumers Energy Company, which is a subsidiary of CMS Energy which is also headquartered in the state of Michigan, was granted a conditional commitment of up to $5.23 billion for the purpose of investing in renewable energy and the replacement of outdated gas pipes.

Key Issue

PacificCorp, a utility that serves six western states, was successful in securing a conditional commitment for up to $3.52 billion for transmission lines.

These lines will increase the system's capacity to provide wind electricity to customers.

"Loans to utility borrowers pose minimal risk to the taxpayer," an Energy Department official told reporters, adding that unlike the LPO's loans for individual projects, the financing to investment-grade utilities was supported by all the assets of the company.

"In the unlikely event of default, LPO could recover what it is owed, up to the loan amount, beyond the sale or acquisition of assets financed through the loan."