U.S. Geothermal announces having achieved commercial production at its 11 MW San Emidio Unit I geothermal power plant in Nevada delivering power to NV Energy.
Reported today, U.S. Geothermal Inc. announced “that its wholly owned subsidiary, USG Nevada LLC, has notified its customer NV Energy that Commercial Operation was achieved by the new 11.75 gross (8.6 net) megawatt Unit I power plant. Electrical energy from the new power plant is now being sold for $89.75 per megawatt hour (“MWH”), subject to a 1% annual escalator, under the terms of a 25 year power purchase agreement. The new power plant is projected to generate an average of approximately 71,500 MWHs of electrical power each year. The new power plant replaces an existing facility that, prior to being removed from service, generated approximately 23,000 MWH annually using the same production and injection wells.
Mr. Daniel Kunz, Chief Executive Officer of U.S. Geothermal Inc., said, “This is a major milestone for our company, the San Emidio project and the geothermal industry. New and innovative power production technology is now deployed for large-scale and highly efficient generation of electricity. The San Emidio Unit I project was beset with delays that were necessary to ensure that our contractor delivered a fully functional power plant. This new plant is now operating and delivering power on a commercial basis. We truly appreciate the formidable efforts of our employees and contractors and the confidence and patience of our lenders, customer, and shareholders over the last several months.”
USG Nevada LLC expects to immediately file for the Section 1603 ITC cash grant of approximately $11 million for the project. Proceeds from the ITC grant will be used to repay an existing $7.5 million bridge loan and the balance will be available for general corporate purposes. The arrangement of long term financing for the project can now move forward. The project engineering, procurement and construction contractor is working to complete a final list of items required to achieve contract completion under a fixed price contract that includes financial guarantees for the original completion date and power output of the plant.”
Source: Company release via Marketwire