Green Green:  Financing News for the U.S. Geothermal Industry


Volume 2, Number 1
28 February 2001

HOT NEWS

CEC Supports Export of CA Energy Know-How

Up to $4.7 Million Available for Funding Geothermal Projects

GDA Completes Feasibility Study for 30 MWe Assal Power Plant

GEF Launches Private Partnership for Renewable Energy

GRC Issues First Call for Papers for 2001 Annual Meeting

REGULAR FEATURES

In Short

Upcoming Events

Other Geothermal and Related Calendars

Geothermal Project Pipeline

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CEC Program Supports Export of CA Energy Know-How

The California Energy Commission (CEC) is soliciting proposals under Request for Proposal (RFP) Number 500-00-505: the International Energy Technology Export Assistance Program. The program's objective is to increase the export of California-based energy technologies and services to international markets.

A maximum of $120,000 is available per contract -- up to $70,000 will be disbursed immediately, with the balance disbursed in fiscal years 2001-2002 and 2002-2003, subject to availability. The deadline to submit proposals is 22 March 2001. Awards will be made in early April.

Bidders must be able to travel in one of the two following geographic regions: China, Asia, Southeast Asia, India, Pakistan, and Bangladesh; or Mexico, Central America, South America, and the Caribbean.

For more information, contact the CEC Contracts Office at telephone: (916) 654-4788. The RFP may be downloaded from CEC's web site.

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Up to $4.7 Million Available for Funding Geothermal Projects

The CEC opened a new funding opportunity through its Geothermal Target Solicitation, with funding from the Public Interest Energy Research (PIER)-Renewable Energy Subject Area and the Geothermal Resources Development Account (GRDA) Program.

Under the solicitation, up to $4.7 million is available to fund geothermal research, development, demonstration, commercialization, environmental enhancement, impact mitigation, and planning projects. Of the total, approximately $2 million will be for PIER grants, with the balance for GRDA grants or loans. Projects must be located in California or sponsored by a California-based company.

Pre-applications will be accepted 24 January-12 March. Final applications will be accepted 2 April-16 May. The CEC will announce awards on 15 June and begin executing agreements in August.

The solicitation may be downloaded from the CEC Geothermal Program web site.

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GDA Completes Feasibility Study for 30 MWe Assal Power Plant

Geothermal Development Associates (GDA), a private U.S. corporation with over 20 years of geothermal resource and power project experience in the U.S. and overseas, completed a feasibility study for a 30 MWe geothermal power plant in the Republic of Djibouti.

Completed with funding from the U.S. Trade and Development Agency, the study supports the potential commercial viability of a 30 MWe Build-Own-Operate (BOO) project (wellfield and power plant) on a large, high-enthalpy resource in Assal, 100 km west of Djibouti City.

The known Assal geothermal resource covers an area of at least 120 km². Multiple high salinity wells have recorded temperatures of 250-360ºC at depths of 1,100 to 2,100 m. Well logs show strong evidence of a shallower reservoir at 400-600 m in depth with temperatures of 130-190ºC, and a significantly lower salinity. Drilling and flow-testing of up to three production size wells to test both the shallower and the deeper reservoirs will be completed during resource confirmation, prior to plant construction.

The project is estimated to cost $116.9 million, or $3,544 per kilowatt of installed capacity. Financing is assumed to be a combination of grants (5.3%), equity (33.3%), and debt (61.4%).

The U.N. Development Programme (UNDP) has approved PDF-B grant funds of $287,000 to support the completion of the principal project agreements, including a Power Purchase Agreement.

Through UNDP, the Global Environment Facility (GEF) has approved approximately $3 million for drilling and related field activities during resource confirmation, and may also consider supporting other issues that contribute to mitigating in-country risks that affect Djibouti's chances of securing private investment.

Additional potential sources of financial support include the U.S. Department of Energy for resource confirmation, and the International Finance Corporation (IFC) and regional African and Arab funding sources for project implementation.

For more information, contact:

G. Martin Booth, III
President
Geothermal Development Associates
Email

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GEF Launches Private Partnership for Renewable Energy

Developing nations will need up to five million megawatts of new electrical generating capacity over the next 40 years. According to Mohamed T. El-Ashry, CEO and Chairman of the Global Environment Facility (GEF),"If renewable energy captures just 3% of the market in the next 10 years, investments could exceed $50 billion." Private capital will contribute the bulk of the required investment.

GEF wants to partner with the private sector, as described in its new report, "Renewable Energy: GEF Partners with Business for a Better World." GEF wants to partner with the private sector to share the risks in expanding renewable energy markets, thereby accelerating a worldwide transition to renewable energy.

Partnership with GEF helps private power developers frame project proposals to best meet investor requirements, as well as the economic and global environmental needs of specific host countries. GEF can fast-track private-sector projects, potentially helping its partners to avoid delays and enabling them to realize higher returns from international investments. GEF can also:

  • Contribute to project financing and locate additional funding partners,
  • Build the host country’s market volume and stability,
  • Increase the capabilities of companies within the host country to provide supporting products and services,
  • Expand market niches into mainstream opportunities,
  • Work with the host government to encourage policies favorable to private sector investment and cut bureaucratic red tape, and
  • Markedly increase the chances of project viability and long-term profitability.

GEF is the chief funder of renewable energy projects in developing countries. From 1991 to 2000, it approved $570 million in grants for 48 renewable energy projects in 47 developing and transition countries, leveraging over $3 billion.

GEF projects are managed by the U.N. Development Programme, the U.N. Environment Programme, the World Bank, the U.N. Food and Agricultural Organization, the U.N. Industrial Development Organization, the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, and the Inter-American Development Bank.

For more information on GEF activities and its procedures and requirements for renewable energy projects in the developing world, contact:

Hutton Archer, Sr.
Senior External Relations Coordinator
GEF Secretariat
1818 H Street, N.W.
Washington, D.C. 20433
Tel: (202) 473-0508
Fax: (202) 522-3240
Email

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GRC Issues First Call for Papers for 2001 Annual Meeting

The Geothermal Resources Council (GRC) issued the First Announcement and Call for Papers for its 2001 Annual Meeting. For additional information including Author Instructions and Paper Submission Form, see the GRC web site. First draft papers should be submitted by 2 April.

2001 Session Themes and their respective chairpersons are:

  • Commercial Geothermal Technologies
    Dan Schochet, ORMAT International, Inc.

  • Economics & Financing of Geothermal Projects
    Liz Battocletti, Bob Lawrence & Associates, Inc.

  • Enhanced Geothermal Systems
    Ann Robertson-Tait, GeothermEx, Inc.

  • Environmental, Legal & Geothermal Regulatory Aspects
    David McClain, DWMAC, Inc.

  • Geosciences & Geothermal Exploration
    Joel L. Renner, Idaho National Engineering & Environmental Laboratory

  • Geothermal Direct-Use & Heat Pumps
    R. Gordon Bloomquist, Washington State University Energy Program

  • Geothermal Drilling & Completion Technologies
    Mike Prairie, Sandia National Laboratories

  • Geothermal Injection Technologies
    Paul Hirtz, Thermochem, Inc.

  • Geothermal Reservoir Evaluation & Monitoring
    Marcelo Lippmann, E.O. Lawrence Berkeley National Laboratory

  • New Geothermal Projects
    Jim Combs, Geo-Hills Associates or
    José Luis Quijano, Comisión Federal de Electricidad

  • Sustainability of Geothermal Reservoirs
    John Pritchett, Maxwell Technologies, Inc.

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In Short

  • French-owned Alstom won a $112.5 million turnkey contract to construct four 25 MWe geothermal power plants for Mexico's Comisión Federal de Electricidad (CFE). The plants will be located in Los Azufres, Michoacan State. Alstom recently signed two other major contracts in Mexico: for the second phase of the 460 MWe Tamuin coal-fired power plant, and for the extension of the Chicoasen hydro power plant near Tuxtla Guiterrez. Alstom is also constructing three large gas turbine combined cycle plants in the country.

  • Geotérmica del Norte requested two geothermal concessions from the Chilean government to conduct exploration in Region II. The new company, created last year by Codelco and Enap, will invest $345,000 to explore the Apacheta field and $310,000 to explore the La Torta field.

  • In January 2001, PT PLN, Indonesia's state electricity company, and the Overseas Private Investment Corporation (OPIC) agreed to use the Paris Club payment scheme to pay a $290 million insurance claim arising from the former's failure to honor power purchase agreements on MidAmerican Energy's Dieng geothermal power plant. Under the agreement, PLN will pay the debt over 20 years, following a grace period of four years. The interest rate will be one percentage point above the rate set by the creditors' respective central banks or monetary authorities. In addition, the claim was reduced to $260 million.

  • The Board of the North American Development Bank (NADBank) voted in November 2000 to expand its mandate to finance environmental infrastructure projects in addition to projects relating to water pollution, wastewater treatment, and municipal solid waste. Additional types of projects that may qualify as environmental infrastructure projects under its Charter include projects related to clean and efficient energy, including geothermal. The Board also proposed to increase the geographic region eligible to 300 km on either side of the U.S.-Mexican border. Created under the auspices of NAFTA, NADBank was established and capitalized in equal parts by the United States and Mexico to finance environmental infrastructure projects along the countries' common border.

  • Effective 13 January 2001, the U.S. Trade and Development Agency (TDA) re-opened for business in China. TDA funding in China was suspended following the 1989 Tianamen Square massacre. TDA provides funding for feasibility and pre-feasibility studies for private sector projects. Energy and environment will be two of the areas in which TDA plans to focus.

  • Philippine President Gloria Arroyo expects to sign into law a crucial power reform bill to privatize the Philippines' power generation in June when Congress meets for its final session before adjourning. The proposed law, which Congress has considered for five years, calls for the auction of the generating units of the state utility National Power Corp., and enhanced competition in a sector which produces some of the highest-priced electricity in Asia.

  • Energy-starved North Korea has launched a nationwide campaign to seek alternative energy sources, according to the country's official media. Government offices, army units, factories, and farms are exploring options in solar energy, windmills, tidewater power, and geothermal. The energy shortages in the country are so severe that many hospitals and other public facilities lack heat in the winter. Water pumps on farms are idle, hindering farmers from filling reservoirs with water even during the rice-planting season.

  • Royal Dutch President Jeroen van der Veer estimates that 50% of industrialized countries' energy needs could be met by natural gas and renewables by 2020.

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Upcoming Events

March August
April September
May October
June November
July December
6-9 March 2001
Web site: 5th Indonesian Geothermal Association (INAGA) Annual Meeting and Conference:
"Dedicating Geothermal Energy to Community Prosperity"
Short course: 6 March / Field trip: 9 March
Yogyakarta, Indonesia
Email: Prof. Dr. Ichlasul Amal, M.A.

8-9 March
Web site: European Geothermal Energy Council
2nd Business Seminar -- EGEC 2001
Altheim, Oberösterreich, Austria

10-11 March
IGA Board of Directors Meeting
Yogyakarta, Indonesia
Email: Prof. Dr. Ichlasul Amal, M.A.

13-14 March
22nd Annual PNOC-EDC Geothermal Conference
Makati City, Metro Manila, Philippines
Email: John Patrick L. Catane
The meeting will feature a special session on the Bulalo and Tiwi Geothermal fields operated by Philippine Geothermal, Inc.

19-21 March
Email: 2nd National Convention on Renewable Energy Sources Enforcement-Priorities in Free Market Conditions
Athens, Greece

20-22 March
Web site: Electric Power 2001:
"Generating Clean, Reliable Electric Power in a Competitive Market"
Baltimore, MD
The conference and exhibition are devoted to providing a valuable forum for owner and operating companies committed to retaining generating assets, acquiring new capacity, or both. The event focuses on the needs of management, engineering, and operations decision-makers from power generating companies, both at the plant and corporate headquarters levels.

21-24 March
Web site: Building Energy 2001
Tufts University
Medford, MA
Hosted by Tufts University and organized by the Northeast Sustainable Energy Association (NESEA), the conference will explore avenues to a more sustainable future while promoting economic growth. Building Energy is the premier conference that brings together experts in the fields of renewable energy and green building.

26-27 March
Web site: APEC 21st Century Renewable Energy Development Initiative Private Sector Forum
Portland, Oregon

26-28 March
Web site: Projects International
"Europe's Premier Project Finance Event"
Paris, France
Hear the inside story from over 70 leading experts on oil and gas, power, telecoms, e-project finance, transportation, and water.

27-28 March
Mexico Trade Event
Mexico City, Mexico
Email: Luz Lopez, U.S. Trade Center - Mexico City
The U.S. Department of Commerce and the U.S. Small Business Administration, in collaboration with the Mexican government, are organizing a two-day program that will feature presentations on market opportunities, standards, customs issues, and finance programs for U.S. small and medium businesses interested in the Mexican market. TDA, OPIC and Ex-Im Bank representatives will be among the featured presentations.

30 March-1 April
Email: 2nd International Exhibition on New Energy and Clean Energy, 2001
Shanghai, China

Spring 2001 (date TBD)
Web site: GeoPowering the West Stakeholder Workshop
Geothermal Energy in Idaho and the West
Boise, Idaho (tentative)
Email: Bob Neilson, Idaho National Engineering and Environmental Laboratory

1-3 April
16th Annual Global Power Markets Conference
New Orleans, LA
Tel: (718) 317-6737 / Fax: (718) 317-9738
The industry's most market-savvy participants will provide valuable insights on asset strategies, gencos, retail and transmission businesses, risk analysis, distributed generation, natural gas prices, electric and gas convergence, RTOs, FERC Order 2000, and financing.

4-5 April
Web site: Export-Import Bank of the United States
2001 Annual Conference
Washington, D.C.

24-27 April
Web site: 18th Latin American Conference on Rural Electrification (in Spanish)
San José, Costa Rica
Email: Licda. Guillermina Gonzalez Zuniga

3-4 May
Web site: Renewable Energy in Maritime and Island Climates (REMIC)
Belfast, Ireland

8-10 May
Web site: Sustain 2001: the World Sustainable Energy Conference
Amsterdam, The Netherlands

10-13 May
Email: International Conference on Drilling Technology
Ferrara, Italy

13-16 May
Web site: 7th National Clean Cities Conference
Philadelphia, PA
Email: Kimberly Taylor

20-24 May
Web site: Geochemical Aspects of Sustainable Energy Utilization
A Symposium at the 11th V. M. Goldschmidt Conference
Hot Springs, VA
Email: Dave Wesolowski or D.R. Cole, Oak Ridge National Lab
Keynote speakers will include Wallace S. Broecker of the Lamont-Doherty Earth Observatory, who will address the fossil fuel impacts on global climate change; Donald Langmuir of the Colorado School of Mines (Emeritus), who will discuss various aspects of the geochemistry of nuclear waste storage, disposal, and remediation; and Marshall J. Reed of the U.S. Department of Energy, who will provide an overview of the technological challenges facing the geothermal industry.
Those interested in participating should submit an abstract by the early February deadline.

10-15 June
Web site: 10th International Symposium on Water-Rock Interaction
Villasimius, Sardinia, Italy
Email: Prof. Luca Fanfani

10-16 June
Web site: 5th International Meeting -- Heat Flow and the Structure of the Lithosphere
Castle Kostelec, Czech Republic
Email: Dr. Vladimir Cermak

7-10 July
38th U.S. Rock Mechanics Symposium
Washington, D.C.
Email: John Tinucci, Technical Program Director, Pan Technica Corporation

8-12 July
Web site: 4th International Thermal Energy Congress (ITEC 2001)
Cesme-Izmir, Turkey
The objectives of ITEC are to provide a firm bridge between northern and southern countries in the field of thermal energy technologies; to provide a forum and encourage a realistic dialogue at all levels, thus stimulating the professional communities and enhancing technical activities in the field; and to accelerate developments, innovations, implementations of R&D and exchange of information in thermal energy fields, including geothermal.

26-29 August
Web site: 2001 Geothermal Resources Council Annual Meeting
Web site: Geothermal Energy Association Trade Show
San Diego, CA

26-31 August
Web site: Stanford/Heriot-Watt Forum on Reservoir Description and Modeling
Carmel-by-the-Sea, California

27-31 August (tentative)
U.S.-China Clean Energy Symposium and Exhibition
Beijing, China
Ministry of Science and Technology
Email: Lee Gebert, DOE

17-22 September
Web site: International Geothermal Days
"Germany 2001"
Email: Prof. Kiril Popovski

8 October
Email: Power Generation and Sustainable Development
Liege, Belgium

21-25 October
Web site: 18th World Energy Congress
Buenos Aires, Argentina
Under the theme "Energy Markets: The Challenges of the New Millennium," the 18th WEC -- the largest and most important global energy event -- will gather over 5,000 delegates, including ministers, regulators, CEOs of major energy companies, other industry operators, senior academic researchers, and consultants from approximately 50 international organizations and financing institutions.
The Buenos Aires Congress will be the first WEC Congress of the new millennium and the first to be held in Latin America, a region which offers an expanding and dynamic energy market, of vital importance for the global economy.

21-23 November
Web site: Geothermal Energy in Undergound Mines
Uston, Poland
Email: Geothermal Conference, Faculty of Earth Sciences, University of Silesia

16-26 August 2004
Web site: 32nd International Geological Congress
Florence, Italy
Email: Matteo Moscatelli, Newtours SpA

2005
World Geothermal Congress 2005
Antalya, Turkey
WGC2005 First Announcement

To have your event listed, contact the Editor.

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Other Geothermal and Related Calendars:

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Geothermal Project Pipeline

The following projects are in various stages of development. Projects which have not been listed before are marked NEW.

Country Project Name Financing Source US$ (millions)
Djibouti Assal Geothermal Power Plant (Feasibility Study) Geothermal Development Associates, U.S. Trade and Development Agency $.09
El Salvador
Concessions of San Vicente and Chinameca Geothermal Fields Projects

Public Bid Nos. SIGET/GE-02/CG-2000, SIGET/GE-03/CG-2000
The General Superintendence of Electricity and Telecommunications of El Salvador (SIGET) invites national and foreign entities interested in the generation of electricity to submit information for the qualification phase for the concessions of San Vicente and Chinameca geothermal projects to be awarded for the construction and operation of power generation projects. Proposal submission deadline was 4 December 2000
Indonesia
PLTP Derajat (275 MWe) Amoseas Indonesia, Chevron, Texaco, PT Derajat Geothermal Indonesia, PT Prasarana Nusantara $475

Tariff cut; project on track to come on-line in 2002
Indonesia
NEW
Sarulla, North Sumatra Unocal North Sumatra Geothermal Ltd. The company has identified two development areas: Silangkitang with a capacity of 100 MWe, and Namora-I-Langit, which can support three generation units totaling 210-290 MWe.

Postponed in 1997; negotiations underway 2001
Kenya Olkaria II, 64 MWe (2 x 32)

Kingston Morrison, Mitsubishi Corporation, H. Young
European Investment Bank, World Bank (IDA), KFW (Germany), Kenya Electricity Generating Company (KenGen) $178

Due to be commissioned July 2002
Kenya Olkaria III, 64-100 MWe Ormat International

BOO with 20-year concession
$155

13 MWe on-line; additional 4 MWe to be provided in December 2000
Kenya Olkaria IV, "Domes" and Eburru, 64 MWe Development will be open to the private sector; contact Ministry of Energy or Steve Hirsch Scheduled to come on-line 2005/6
Mexico Cerro Prieto IV, 100 MWe (4 x 25) Japan Bank for International Cooperation, BNP Paribas, ING Bank, Mitsubishi $120.0

August 2000 - Cerro Prieto IV (100 MWe) began startup, BLT with a 12-year lease, the first private geothermal project in Mexico
Mexico
Las Tres Virgenes, 10 MWe (2 x 5) CFE Tender In development
Mexico Los Azufres II, 100 MWe (4 x 25) ALSTOM won turnkey order

Funded under a privately financed scheme called OPF: the company assumes construction risk and sells the finished plant to CFE.
$112.5

Initiation of Project - 2001, Plant Commissioing - end of 2002
Mexico
Los Azufres, III (Primavera), 75 MWe CFE Tender In development
Mexico
Los Humeros, 50 MWe CFE Tender In development
Mexico Off-Grid Rural Electrification (MXGE68390) World Bank, Global Environment Facility

The project will test private-sector implemented mechanisms for sustainable electrification of off-grid rural areas, using conventional and renewable energy technologies, as feasible.
$6.5

Appraisal mission is tentatively scheduled for mid-August 2001.

Consulting services to be determined.
Philippines Rural Power (formerly Rural Electrification) World Bank

Contact:
Mr. Reuben Emmanuel T. Quejas,Chief, Nonconventional Energy Division, Department of Energy, Energy Center, Merrit Rd., Fort Bonifacio, Taguig, Metro Manila, Philippines, Tel: (63-2) 844-1021 to 40, Fax: (63-2) 818-8614, Email: rquejas@doe.gov.ph
$20.0

Project is being identified.

Consulting services to be determined.
Russia Mutnovsky Independent Power Project, Kamchatka, 50-250 MWe European Bank for Reconstruction & Development, CSC Geoterm $353.2

Stage I - 50 MWe (2 x 25) (expected on-line 2001)
Stage II - 100 MWe (expected on-line 2004)
Stage III - 100 MWe (expected on-line 2005)
Uganda
Alternative Energy Resource Assessment and Utilization Study

Notice Identification No. AfDB138-547/00
African Development Fund

Contact:
The Permanent Secretary, Ministry of Energy and Mineral Development, P.O. Box 7270, Kampala, Uganda, Tel: (256-41) 234-733, Fax: (256-41) 234-732. Email: psmemd.upppre@infocom.co.ug
TBD

The main objective of the study is to find a technically, financially and economically feasible, socially and environmentally sound, and sustainable least cost alternative energy resources development program to meet the energy demand of energy deficient rural areas and small towns of Uganda.
Viet Nam
Central Region Geothermal Power, 50 MWe (Feasibility Study) U.S. Trade and Development Agency The U.S. Trade and Development Agency is providing a grant in support of a BOT contract to be negotiated with the Ministry of Industry. The feasibility study will study the electricity tariff and benefits of the project.
Viet Nam Central Region Geothermal Power, 50 MWe Ormat International

Sole source project; BOT
$141.0

Ormat received a renewed exploration license in September 2000.

Sources: United Nations Development Business; the Infrastructure Division; the International Trade Administration, U.S. Department of Commerce Global Infrastructure Projects Database; others as noted.

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Watch for the next issue of Green Green coming
30 April 2001

THE SMALL PRINT

Green Green is produced for the Idaho National Engineering & Environmental Laboratory (INEEL) under Purchase Order No. K99-181018 and the U.S. Department of Energy, Assistant Secretary for Energy Efficiency and Renewable Energy, Office of Wind and Geothermal Technologies.

This information was prepared as an account of work sponsored by an agency of the U.S. Government. Neither the U.S. Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise, does not necessarily constitute or imply its endorsement, recommendation, or favoring by the U.S. Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the U.S. Government or any agency thereof.


Green Green is produced by
Bob Lawrence & Associates, Inc.
Liz Battocletti, Editor

345 South Patrick Street
Alexandria, Virginia 22314 USA
Phone: 703 836 3654 / Fax: 703 836 6086
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