The Geothermal Energy Association brings you this week’s leading news and member company headlines.
*DOE’s Geothermal Technologies Office Provides Details on FY 2015 Request
*County Payments Again a Budget Target in FY 2015 Budget Proposal
*Geothermal and Solar Provided Most New U.S. Generating Capacity in January 2014
*2013 Geothermal Technologies Office Peer Review Report Available
*Federal Government Considers Salton Sea Support for California
*Alstom Power: Company Looking at Turkish Stake
*Capuano Engineering Company: Montserrat a Highly Potential Geothermal Resource
*U.S. Geothermal: First Distribution of Profits from the Neal Hot Springs Project Announced
But first, our Graph of the Week:
*A Race to the Top of the Global Geothermal Market
Above: Our Graph of the Week shows the nameplate capacity of geothermal power in eight established geothermal power markets worldwide. In 2013, the international geo power industry surpassed the 12,000 MW milestone, and the U.S. contains the most resources on line by far. However, other countries are moving up to challenge the U.S. to that title and could equal or surpass the U.S. capacity in the near future. GEA will detail geothermal market developments in its 2014 U.S. & Global Geothermal Power Production report, set to be released exclusively to the attendees of GEA’s International Showcase on April 22 in Washington, DC. This popular report will not be available to the public until a week after it is distributed to attendees at the event. Click here to register to attend, and be the first to read this year’s report.
DOE’s Geothermal Technologies Office Provides Details on FY 2015 Request
The Geothermal Technologies Office of the DOE has provided details on its FY 2015 budget request. The chart below details allocation requests for: Enhanced Geothermal Systems (EGS), Hydrothermal, Low-Temperature and Coproduced Resources, Systems Analysis, and NREL Site-Wide Facility Support.
The GTO seeks to demonstrate the capability to create and sustain a 5-MW EGS reservoir by 2020, and to lower the levelized cost of electricity from newly developed geothermal systems to $0.06/kWh by 2030.
As we noted last week, the Obama Administration’s proposed budget for FY 2015 includes $62 million for Geothermal Technology, a 34% raise over last year, out of $2.3 billion for the combined Office of Energy Efficiency and Renewable Energy and a U.S. Department of Energy total proposed budget of $27.9 billion. The DOE total is a 2.6% increase over the FY 2014 enacted.
County Payments Again a Budget Target in FY 2015 Budget Proposal
The DOI Budget, in its “Legislative Proposals and Offsetting Collections” document proposes to repeal the provisions of the 2005 Energy Act that provided a portion of geothermal revenues to counties affected by geothermal operation and development.
The Budget document states: “Termination of Geothermal Energy Payments to Counties – The 2015 budget proposes to repeal Section 224(b) of the Energy Policy Act of 2005 to permanently discontinue payments to counties and restore the disposition of Federal geothermal leasing revenues to the historical formula of 50 percent to the States and 50 percent to the Treasury . . . The repeal of Section 224(b) is estimated to result in savings of $4 million in 2015 and $42 million over ten years.”
In a letter dated February 27, Members of Congress led by Mike Thompson (D-CA) asked President Obama not to repeal the royalties. It was also signed by Reps. Joe Heck (R-NV), Steve Pearce (R-NM), Jared Huffman (D-CA), John Garamendi (D-CA) and Juan Vargas (D-CA). “We understand the need to propose a fiscally prudent budget, but repealing geothermal royalty payments to counties is a short sighted method that does nearly nothing to solve our fiscal problems,” says the letter.
Rep. Thompson said in a March 12 statement: “When a community invests in developing geothermal energy, they deserve to get their fair share in returns on those investments,” said Thompson. “Stripping counties of these returns is a short sighted, fiscally irresponsible plan that will have no meaningful impact on deficit reduction. It will rob counties of the funds they depend on to pay for things such as public safety, road maintenance and law enforcement. I will work with my Republican and Democratic colleagues in both the House and Senate to make sure any budget passed by Congress doesn’t include the President’s proposed geothermal cuts.”
Geothermal royalties have gone to counties since the bipartisan Energy Policy Act of 2005. Click here for a GEA report on Geothermal Revenue Under the Energy Policy Act of 2005.
Geothermal and Solar Provided Most New U.S. Generating Capacity in January 2014
Geothermal energy was the second largest category of new electric capacity placed in service in the U.S. in January 2014, after solar power. Gradient Resources brought the Patua Hot Springs project in Nevada on line, with power going to Sacramento Municipal Utility District under a long-term contract.
2013 Geothermal Technologies Office Peer Review Report Available
GTO News ~ The 2013 Geothermal Technologies Office Peer Review Report is now available for download. The report provides a summary and compilation of expert, independent technical feedback on GTO-funded projects, as well as feedback from the Peer Review meeting conducted on April 22-25, 2013. Provided in three sections, this comprehensive technical report assesses 100 projects in the GTO portfolio, based on presentations from GTO-funded principal investigators that were evaluated and scored by reviewers.
The Executive Summary covers summary information about the platform and overall objectives of the event. The main body of the report summarizes the scoring methodology, project scores, findings, and recommendations. The appendices detail the feedback and written comments from the team of reviewers.
Read more about the 2013 Peer Review Meeting or see individual project presentations by awardees. The Geothermal Technologies Office funds more than 150 research, development, demonstration and analysis projects, representing over $500 million in total combined investment.
Federal Government Considers Salton Sea Support for California
The conversation about California’s Salton Sea geothermal resources continues on the national level with a congressional hearing, a Department of the Interior memorandum of understanding with the Salton Sea Authority, and a request by the Obama administration for $500,000 to be allocated for Salton Sea projects by the U.S. Bureau of Reclamation and the Army Corps of Engineers.
A PG&E article looks at geothermal energy in California, while this week, GEA’s Exective Director Karl Gawell and Chairman Jonathan Weisgall of MidAmerican Energy will speak at the 7th annual Imperial Valley Renewable Energy Summit.
Alstom Power: Company Looking at Turkish Stake
GEA company member Alstom Power is in preliminary agreements for 30% stake in Turkish energy company Deltom Jeotermal.
Capuano Engineering Company: Montserrat a Highly Potential Geothermal Resource
An article in Caribbean press highlights Montserrat island’s geothermal project updates with comments from Minister of Communication and Works Hon Charles Kirnon that the project will move past production well testing in the coming months.
Louis Capuano Jr., President and CEO, Capuano Engineering Company (a GEA member company) tells GEA that although vital information would have to come from his client, the testing has been successful. “We were project managers,” he says. “I can say that we have successfully completed two full-sized deep exploration wells and were quite successful in finding a highly potential geothermal resource. The wells were completed in 2013 and we are presently completing the short-term well tests and resource sampling and will begin the long-term testing of both wells to be completed this summer. The results of the tests will then be paired with power generation systems.
“Montserrat could be the first nation to be completely powered by geothermal energy if all goes well,” Capuano adds.
U.S. Geothermal: First Distribution of Profits from the Neal Hot Springs Project Announced
U.S. Geothermal Press Release (BOISE, IDAHO) March 10 ~ U.S. Geothermal Inc. (NYSE MKT:HTM) (TSX:GTH), a leading renewable energy company focused on the development, production and sale of electricity from geothermal energy, announced today that Oregon USG Holdings LLC has made its first distribution of profits from the Neal Hot Springs project. Oregon USG Holdings is owned 60% by U.S. Geothermal and 40% by a subsidiary of Enbridge Inc. Under the terms of the U.S. Department of Energy loan agreement, profits are distributed to the equity partners semi-annually (February and August) following Final Completion, which was achieved on August 1, 2013. U.S. Geothermal’s share of this first distribution is $4.6 million, out of a total distribution to the partners of $7.7 million, which represents profits generated from the project since initial operation began in November 2012.
“After years of effort by our team, we are now realizing significant cash flow from the Neal Hot Springs project,” said Dennis Gilles, Chief Executive Officer of U.S. Geothermal Inc. “And, while the amount of this first distribution represents profits generated over a longer time period than future anticipated semi-annual distributions, it is an important milestone, with the project operating both successfully and contributing predictable cash flow to the Company. This cash, in addition to the previously announced cash received with the resolution of the equity ownership percentage, places our company on a very solid footing to support our current growth activities.”