Geothermal

Meg Cichon Geothermal well photo via Bigstock The renewable energy industry had quite a bit to celebrate this week as 2013 rang in a PTC extension that many had feared would never come to fruition. Though the extension to January 1, 2014 greatly benefits the wind industry, whose PTC was set to expire at the end of 2012, it also included a provision that could be huge for geothermal development. This provision states that projects under construction by January 1, 2014 would quality for the PTC, rather...

Tom Konrad CFA Last week, I was on a panel at the Inside Commodities Conference, and spent some time talking with Tyler Mordy, director of research at Hahn Investment.  He's a top-down analyst (and CFA Charter holder) who had recently grown enthusiastic about Alternative Energy in general because the sector is so beaten down. We agreed that the most-beaten down sector of alternative is geothermal power stocks, which Tyler finds frustrating because Hahn works with managed ETF portfolios, and there simply is no geothermal ETF.  Nor is there likely to be, since one publicly traded company dominates the industry (Ormat Technologies...

Tom Konrad CFA Geothermal well photo via Bigstock Ram Power (OTC:RAMPF, TSX:RPG) recently provided an update on progress at its flagship San Jacinto project in Nicaragua.  This was the project where cost overruns and construction delays last year sent the stock plummeting from over C$2 a share to around C$0.50 a share at the start of the year.  The decline has continued, despite the fact that the project seems back on track with the hiring of a new subcontractor, and the stock now trades...

Tom Konrad CFA Hezy Ram Geothermal industry veteran Hezy Ram has worked in the industry for over three decades.  His career began with 28 years of experience at Ormat (ORA), where he was Executive Vice President of Business Development, after which he founded Ram Power Corp. (RPG.TO/RAMPF.PK) in 2009.  In February, he resigned as CEO of Ram Power shortly after the company warned of significant delays and cost overruns at a key Nicaraguan project, a move he says was motivated by irreconcilable differences with other board members and major shareholders regarding the company's strategy.  Today,...

Tom Konrad CFA Holders of Ram Power Corp. (TSX:RPG, OTC:RAMPF) on November 26 (the “record date”) will be receiving valuable coupons as the result of the company’s rights offering, announced November 18th. Just in time for the holidays, these coupons, or “rights” can be used to buy additional shares of Ram Power for 8¢ Canadian per share any time before  5pm on December 23rd. (Disclosure: I am long Ram Power stock.) Holiday shoppers looking for more traditional gifts will be able to raise a little cash by selling the rights on the Toronto Stock Exchange,...

by Debra Fiakas CFA Last week, one of the leaders in a development consortium, Iceland’s largest privately owned energy generator HS Orka hf, announced the completion of a project to prove the merits of deeper geothermal wells.  The project in the Reykjanes Peninsula in southern Iceland reached 4,659 meters depth in January 2017, where temperatures measured 427 degrees Centigrade and fluid pressure was 340 bars.  By all accounts the project was successful, suggesting that deep wells could a cost effective approach to geothermal energy. The drilling program was mentioned in early December 2015 a recent post “Hot...

UPDATE: I just looked into the 7 Series vs the Trilogy 40 in more detail here and came to a slightly different conclusion. Tom Konrad CFA Geothermal heat pump diagram via Bigstock Waterfurnace Renewable Energy (TSX:WFI, OTC:WFIFF) launched its new highly efficient 7 Series geothermal heat pumps (GHP) today.  The 7 Series commercial release beats Climatemaster’s (a division of LSB Industries (NYSE:LXU)) Trilogy 40 as the first commercially available GHP with a variable speed compressor.  The Trilogy 40 is currently available as part of a pilot program, and is expected to be commercially available...

By Jane Pater Salmon, Navigant Consulting Geothermal energy presents baseload clean energy at a lower cost than many other renewable energy alternatives. Despite this compelling value proposition, long development horizons and the risks associated with exploration and drilling activities present hurdles to developing the country's rich geothermal potential. Financing projects that use conventional geothermal technology remains challenging in the uncertain economic environment. In the past year, geothermal project developers used alternative strategies to overcome three common challenges to geothermal project finance. While the challenges for raising capital at the project level are consistent with those faced in...

by Debra Fiakas CFA US Geothermal (HTM:  NYSE) has been on our radar for some time.  Despite considerable accomplishment in terms of building electricity output from a portfolio of geothermal power installations, investors seem reluctant to embrace the company and its stock.  Earlier this week, US Geothermal management issued its usual quarterly update on its development work, this time detailing progress in expanding capacity and improving well performance on three of its geothermal installations.  Altogether an incremental 90 megawatts are under development, which would triple the current power generation capacity of 45 megawatts.  The company press release was met by...

by Debra Fiakas CFA Olkaria III Geothermal Power Plant, Kenya Shares of geothermal power developer and utility Ormat Technologies (ORA:  NYSE) are trading at 24.7 times the consensus estimate for 2013.  That seems pricey on the surface, but the stock is down from a 52-week high of $22.24.  The stock gaps up and down with regularity, suggesting ORA is a battle ground for bulls and bears.  The fact that the 50-day moving average price continues to descend toward the longer-term 200-day average, hints that maybe the bears are...

Paul Schwabe Among renewable resources, one of the most valuable attributes of geothermal electricity is the baseload characteristic of the energy resource. That is, geothermal electricity generators are able to deliver a stable level of power production over time. Yet for better or worse, this baseload characteristicalong with other notable factors such as size constraints and varying market segmentsreveals that interconnecting a geothermal plant to a transmission or distribution system poses unique challenges compared to other renewable energy technologies . A recent report by NREL, "Geothermal Power and Interconnection: The Economics of Getting to the Market," delves...

Tom Konrad CFA Geothermal heat pump diagram via Bigstock A couple weeks ago, I compared the efficiency of the two most advanced geothermal heat pumps (GHPs) recently launched by Waterfurnace Renewable Energy (TSX:WFI, OTC:WFIFF) and Climatemaster, as division of LSB Industries (NYSE:LXU).  Like most things in life, it turns out that heat pump efficiency is a lot more complicated than just comparing a couple numbers. Since I concluded that Waterfurnace’s 7  Series heat pumps were slightly more efficient than Climatemaster’s Trilogy 40 pumps, one of Climatemaster’s district managers pointed me...

FPL Group Inc (FPL) is currently in the advanced stages of negotiations to acquire Constellation Energy Group (CEG). An FPL-Constellation merger would create a giant East Coast-based utility with a market capitalization, based on Tuesday's closing stock prices, of $26.97 billion - $16.93 billion for FPL and $10.04 billion for Constellation. Constellation Energy Group is based out of Baltimore Maryland and is the holding company for Baltimore Gas and Electric. They also have an extensive presence in the wholesale power supply and generation business. The Power Generation Division currently uses 4.6% alternative sources for power generation. ...

Ormat Technologies (ORA) announced that Ormat subsidiary, Puna Geothermal Venture ("PGV"), completed the re-drilling of an existing production well at the Puna Geothermal Project (the "Puna Project") located on the Big Island, Hawaii. The well re-drilling increased net generating capacity of the power plant by approximately 4 MW, bringing total net generating capacity to approximately 29 MW.

Nevada Geothermal Power Inc. (NGLPF) announced that it has initiated development drilling at Blue Mountain Nevada. Production test data from the wells will be used to complete a feasibility study for an initial 30 MW geothermal power plant. In the initial program, four 13-inch diameter production wells will be drilled to 4000 feet (1200 metres) into the moderate temperature (300-330 degrees C) geothermal resource intersected in previous test holes. Permits have been obtained and drill pads are under construction. A water well rig will be used to drill the top 800 feet of each well and to...