U.S. Geothermal’s Neal Hot Springs project selected for DOE Loan Program
U.S. Geothermal Inc has been selected by the U.S. Department of Energy (DOE) to enert into due diligence review on a US$85 million project loan for its Neal Hot Springs project in eastern Oregon.
As announced by the company, U.S. Geothermal Inc “has been selected by the U.S. Department of Energy (DOE) to enert into due diligence review on a US$85 million project loan for its Neal Hot Springs project in eastern Oregon.
The DOE loan is expected to provide 80% of the $106 million estimated total capital cost. Construction of a binary cycle power plant utilizing significantly improved technology is expected to begin in mid 2010. The new plant, designed to deliver 22 megawatts (“MW”) of power net to the grid, is scheduled to begin commercial operations in late 2011. The DOE loan is anticipated to be a combined construction and long term loan and provide the project with a low cost annual interest rate.
On February 26, 2009 U.S. Geothermal submitted an application for the Neal Hot Springs project to the DOE’s Energy Efficiency, Renewable Energy and Advanced Transmission and Distribution Solicitation loan guarantee program under Title XVII of the Energy Policy Act of 2005. The company was notified that its project application is complete, the power plant technology choice qualifies as new or improved under the program, and the project has been selected to proceed in the project loan process.
The renewable energy is expected to be sold under a long term power purchase agreement that is
currently under advanced negotiations.
“Another critical milestone in the development of our project at Neal Hot Springs has been achieved and provides us with access to a source of low cost capital”, said Daniel Kunz, CEO and President of U.S. Geothermal. “As we enter into due diligence with the DOE on this important US$85 million loan we can now work to complete the balance of the project requirements necessary to construct an advanced and highly efficient geothermal power plant.”
Source: Company release (pdf)