U.S. Treasury Department Awards Nevada Geothermal Power, Inc. a $57.9 Million Grant

The United States Department of the Treasury awarded a $57.9 million federal grant to Nevada Geothermal Power (CVE:NGP).

The $57.9 million is for specified energy property in lieu of tax/credits relating to the Blue Mountain 'Faulkner 1' geothermal power plant. The grant was approved under Section 1603, Division B of the American Recovery and Reinvestment Act of 2009.

Nevada Geothermal Power (NGP) is an emerging renewable energy developer focused on producing clean, efficient and sustainable geothermal electric power from high temperature geothermal resources in the United States. The company owns a 100% leasehold interest in four properties: the Nevada-based Blue Mountain, Pumpernickel and Black Warrior, and Crump Geyser in Oregon. These properties are at different levels of exploration and development. NGP estimates a potential of over 200 MW from the current leaseholds.

According to an NGP release, the 'Faulkner 1' geothermal power plant went into service on October 9, 2009, and is currently producing power at a sustainable rate of 27 MW net. As previously released, plant output is limited by deep injection capacity. Three additional deep wells will bring the plant up to full production capacity of greater than 40 MW (net). The company reports that grant funds will be used to complete the additional drilling and pipeline connection.

Plant capacity tests indicate that the power conversion system is approximately 20% more efficient than the base design. The improved efficiency results from both higher brine inlet temperature to the plant and a more efficient power conversion. Thus, the company expects the net output of the plant can be increased up to 47 MW (net) with additional fluid production.

A recent article in the Energy International Quarterly, explores the Nevada Geothermal Power, Inc.  The article's author Sarah Lozanova has this to say about the company:  “Despite significant research on geothermal energy in the western United States during the 1970s and early 1980s, there was little development in the years that followed. So Nevada Geothermal Power Inc. certainly proved to be ahead of the pack when it obtained 100-percent leasehold interest in four properties while geothermal development was more or less stagnant.”

In her article titled “NGP Inc.: Harnessing Clean Energy from the Desert,” Lozanova quotes Brian Fairbank, the CEO of NGP.  “We acquired our properties in the early 2000s,” Fairbank said. “At the time we were one of the few companies working on projects in Nevada. There had been a lot of legacy work done in the ’70s and ’80s, and part of our criteria for acquisition was to look at projects that already had exploration work done and were close to transmission lines.”

Fairbanks told Lozanova that the subsequent land rush has shaped the industry in recent years and driven up land prices. “There’s a lot of competition now for properties,” Fairbank added. “When we first started, there wasn’t much going on with geothermal because there was a lot of cheap energy around. That changed in the early 2000s, with the California energy crisis.”