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Technology Frontier

Extracting Earth’s Energy

U.S. GeothermAl reAdy to tAp SteAm

By Al Senia

Geothermal enerGy may be about to enter the nation’s alternative energy mix in a significant way. In a remote desert Idaho location, a new $35 million geothermal energy plant is being constructed at a site where, 30 years ago, pro- ponents believed geothermal promised a true energy breakthrough. this time, however, a new vision as well as a substantial federal tax credit, growing concern about global warming and high natural gas prices — may make the critical difference in giving the technology real legs. Still, the raft river power project near malta, Idaho, some 200 miles southeast of Boise, at first glance might ignite some skepti- cism. Workers are drilling wells one mile deep in the Idaho desert, looking to extract 300-degree water, which can be converted into energy that would be sold to regional utilities and then pumped back into the earth’s crust. officials with U.S. Geothermal, the renewable energy development company that is overseeing plant construction, intend to produce 10 megawatts monthly average power output from the binary-cycle geothermal plant beginning in the fall of 2007. that would generate $5 million in annual revenue, according to company officials. Idaho Power recently signed a 20-year purchase agreement with U.S. Geothermal. Daniel Kunz, the company’s Ceo, hopes a second phase of the plant will go online in late 2008, producing an additional 25 megawatts of power. a third phase is planned for 2011 with the potential for another 50 megawatts of production. “We see the ultimate potential here to produce a couple of hundred megawatts of clean energy,” said Kunz. “the technology is not new. It’s 25 years old. But it is unique in its reliability. It’s tried-and- true technology. We have the newest generation of it.” Karl Gawell, executive director of the Geothermal energy association (Gea), believes raft river will do a lot to validate the recognition of geothermal power as an alternate energy source in the western United States “Geothermal in some ways is still a pioneering technol- ogy,” said Gawell, “raft river is the first (geothermal) project in a new region that is proving that it is not a get-rich-quick scheme. It is really important because this Idaho resource has never been tapped before, and many people believe it is a major resource.” according to Gea, raft river is one of 45 geother- mal power projects currently under development in nine western states. the projects have the potential to produce between 1,818 and 2,095 megawatts for the power grid, nearly doubling the total current geothermal power production in the United States Gawell noted that the availability of geothermal energy varies by region, with California already emerging as the industry leader. In that state, CArBon dioxide BUriAl in neBrASkA Carbon dioxide produced by coal-burning power plants could be readily injected into southeast Nebraska or the state’s western Panhandle, according to Edward Steadman, a professor at the University of North Dakota. “The Plains states are in a good position because we have fairly nice geology,” he said, according to a news report.


the technology is not new..

.it’s 25 years old.. .But it is unique in its reliability.

Source: www.usgeothermal.com

Steam rising from the testing of a geothermal well 200 miles southeast of Boise, Idaho.

Gea says the percentage of electricity derived from geothermal exceeds seven times the national average. Geothermal is the largest non-hydro renew- able-energy source in California. In another study, the Western Governors’ association Geothermal task Force identified more than 100 sites in the United States with near-term development potential.

however, geothermal still has to prove its economic viability. raft river could help achieve that goal. last august, a financial partnership was formed between U.S. Geothermal (which is publicly traded on the otCBB stock exchange) and an affiliate of the Goldman Sachs Group to own, construct and operate Phase 1 of the plant. U.S. Geothermal made a $5 million cash contribution to the partnership, called raft river energy I. U.S. Geothermal is also transferring seven existing production and injection wells, as well as specific geothermal rights and leases covering 1,800 acres from the 5,200 total acres of geothermal rights current held. the Goldman Sachs affiliate kicked in the $34 million needed for construction. officials say an independent assess- ment shows there is a 50 percent probability that 15.6 megawatts per square mile exists at raft river.

Just the fact that such a partnership could move forward helped validate the financial viability of geothermal as an important future energy source, Kunz and others believe.


EnErgyBiz magazinE

November/December 2006


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