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Useful guidebook to geothermal power finance by NREL/ Navigant

Guidebook to Geothermal Power Finance (snapshot)
Alexander Richter 5 Apr 2019

While already released in 2011, the Guidebook to Geothermal Power Finance released by NREL, co-authored by Navigant is still a rather useful document detailing elements required to financing geothermal project development.

In 2011, we reported on a Guidebook on financing geothermal power projects that was released by the US Department of Energy’s National Renewable Energy Laboratory.

Co-authored by consulting company Navigant, the Guidebook to Geothermal Power Finance intended to facilitate further investment in conventional geothermal projects in the United States is still a rather useful document.

It includes a brief primer on geothermal project development. The trends in geothermal project finance are the focus of this tool, relying heavily on interviews with leaders in the field of geothermal project finance.

>> Download your copy of the guide here (pdf)

Using the information provided, developers and investors may innovate in new ways of developing partnerships that match investors’ risk tolerance with the capital requirements of geothermal projects in the dynamic and evolving marketplace.

The guidebook identifies several positive developments in the market for financing conventional geothermal power projects in recent months, including:

  • Improved access to capital and financing terms. This is evident in the anticipated return of a specific type of bridge finance to the U.S. geothermal project finance market and in the loosening of construction financing.
  • Innovative structures to facilitate deals. Groups of investors are pooling resources to create risk profiles in line with their objectives. Construction and term loans are being bundled, reducing transaction costs and streamlining investment.
  • Anticipated return to the tax appetite needed to facilitate tax equity transactions. A return to profitability for many institutional investors is a critical input to successfully monetizing the federal tax credits that complement the Treasury Cash Grant program.

The Guidebook will be of interest to developers of conventional geothermal power, investors interested in geothermal projects, and regulators in areas where geothermal resources may contribute to the achievement of renewable energy portfolio standards.

Source: ThinkGeoEnergy 2011