U.S. Geothermal Inc. (NYSE Amex: HTM) was offered a conditional commitment for a $102.2-million loan guarantee from the U.S. Department of Energy (DOE) to construct the planned 22-megawatt power plant at Neal Hot Springs in Eastern Oregon.
The Neal Hot Springs development project is the first geothermal project to be offered such a commitment.
Issuance of the loan guarantee is subject to the satisfaction of certain conditions. Once issued, it will guarantee the project loan from the U.S. Treasury’s Federal Financing Bank.
"There is tremendous potential for renewable geothermal energy and the jobs for Oregon that come with it," said Senator Ron Wyden. "The announcement today helps make commercial development of geothermal energy at the Neal Hot Springs a reality. This is good news for Oregon and the environment."
Idaho’s largest utility, Idaho Power Company, has signed a 25-year power purchase agreement with U.S. Geothermal’s subsidiary, USG Oregon LLC, for up to 25 MW of power per year. Beginning in 2012, the flat energy price is $96 per MW hour. The price escalates annually by 6% in the initial years and by 1.33% during the latter years of the agreement. The approximate 25-year levelized price is $117.65 per MW hour.
Houston-based TAS Energy Inc. will handle construction of the power plant. TAS founder and Chief Technology Officer, Tom Pierson said more than 95% of the content of the TAS power plant is expected to be manufactured in U.S.-based factories.
The Neal Hot Springs project site, near Vale, Oregon, not far from the Idaho border, covers 8.5 square miles.
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