U.S. Geothermal takes step for full ownership of Raft River geothermal plant, Idaho
U.S. Geothermal has reached an agreement with Goldman Sachs, to acquire the remaining ownership interest in its 18 MW Raft River geothermal plant in Idaho. This will allow implementing capital upgrades to increase output of the plant.
In a release today, U.S. Geothermal Inc. announced today that it has reached an agreement to acquire its partner’s remaining ownership interest in Raft River Energy I LLC from Goldman Sachs. The purchase is scheduled to close on January 2, 2018 and the price consists of a one-time, $350,000 cash payment from U.S. Geothermal to Goldman Sachs. The Company will then own 100 percent of the project.
“The acquisition of this remaining interest in Raft River will be immediately accretive to the Company, and further enables us to implement capital upgrades to increase output from the facility,” said Douglas Glaspey, Interim Chief Executive Officer. “This transaction confirms our ability to grow the business with a disciplined approach to capital allocation by focusing on acquisitions that are strategic to our core business and by increasing generation at our existing power plants.”
Raft River Energy I is located in Southern Idaho, near the town of Malta, and achieved commercial operation on April 3, 2008. The Raft River facility is a single, 18-MW (gross) module, with a design output of 13 MW (net) annual average based on a specific flow and temperature of geothermal brine. The PPA for the project was signed on September 24, 2007 with the Idaho Power Company and allows for the sale of up to 13 MW of electricity on an annual average basis over a 25-year term. Renewable Energy Credits are sold under a separate contract. In 2018, the PPA energy price, plus the value of the renewable energy credit will be $74.32 per MWh.
The Company is in a continuing process to increase generation at Raft River through modifications at the existing facility. The addition of production well RRG-5 along with upgrades to the injection system in 2017 increased the average generation from the Raft River plant by approximately 1.6 net MW. Due to the positive response from the wellfield, which showed a minimal decrease in fluid levels, a study to increase the capacity of production pump RRG-4 in 2018 will be analyzed.
The RRG-4 upgrade project would consist of increasing the capacity of the pump to produce approximately 400-500 gpm more fluid to the plant. This would result in an estimated generation increase of approximately 0.6 to 0.7 net megawatts annual average, or approximately $400,000 of additional revenue for a full year of production. Additional upgrades of wells and surface facilities that would increase revenue are under consideration.
Source: company release by email