Ormat will grow Nevada’s geothermal power 25% with a US Department of Energy loan guarantee
Three geothermal projects totaling 113 MW from Israel’s geothermal giant Ormat got approvals just in time to get US government support under the Recovery Act Section 1705 loan guarantee this week. Nevada has some of the best geothermal potential among the US states, but has barely begun to develop it: the 113 MW will increase Nevada’s geothermal power production by nearly 25%.
Under the same program as Solyndra if Ormat Nevada Inc could line up an investor with up private financing by September 30th, the US Department of Energy would provide a US government guarantee to back the loan in the unlikely event that Ormat was not able to repay its investors.
However the loan guarantee has been anathema to the party that now controls the US congress (Utility-Scale Renewable Projects Become a Casualty of Republican Hostage-Taking) and will end this week.
Last year, Ormat Nevada Inc thought it might not make it (Ormat Abandons loan Guarantee Program) but this week, the company finalized its loan from John Hancock just in time for it to be guaranteed under one of the last of the DOE loan guarantees, before the program is prematurely shut down at the end of the month.
Nevada will get utility-scale deployment of Ormat Energy Converter modules that have been used around the world. The modules are pre-engineered units containing a turbine-generator set, preheater, condenser, integrated vaporizer and feed pump that convert geothermal energy to electricity.
The financing will support clean, sustainable power generation in Nevada for virtually ever. Geothermal projects begun in the 19th century in early adopter nations like New Zealand are still regularly delivering baseload power. It is a safe bet. Ormat holds over 80 US patents and has more than four decades of experience developing geothermal and heat-recovery power and has 1,370 MW of capacity churning out clean electrons around the world.
Ormat has signed a power purchase agreement with Nevada Power Company for its first twenty years of production of low carbon energy generation that causes no asthma or climate change.
But sadly, the project marks one of the last to escape the Republican (“Tea Party”) hammer that will end the Democrats’ push for renewable energy that they begun in 2009, with the Recovery Act economic stimulus. The renewal of the Section 1705 loan guarantees was always going to be tricky after the new Republican majority since 2010.
Congressional Republicans, never fans of renewable energy, adamantly unaware of climate change, and now more than ever force-fed into congress by a gushing hose of funding from the $50 billion Koch Brothers fossil energy money and armed with cute Grover Norquist pledges to not believe in climate change, have found in the Solyndra bankruptcy the perfect excuse to ram through a shut down of the loan guarantee program, killing off all kinds of renewable energy.
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