Ormat Technologies, Inc. (NYSE: ORA), a leading geothermal developer in the United States, and Sierra Pacific Resources (NYSE: SRP) announced a joint-ownership collaboration that deepens their ongoing partnership in developing geothermal projects.
Ormat Nevada, Inc. and Nevada Power Company, respective subsidiaries of the two companies, have entered into a Joint Ownership Agreement (JOA) for a geothermal power project that is currently under development by Ormat Nevada, Inc.
The project, known as the Carson Lake geothermal project, is located in Churchill County, Nevada, on federal lands, a portion of which includes the Naval Air Station Fallon. The Joint ownership will be the first for the two companies that have worked together on other projects.
Ormat Nevada, Inc. will develop the project until the resource is sufficiently defined at a level that is capable of supporting at least 30 megawatts (MW) and Nevada Power Company has regulatory approval to acquire its 50% ownership. Following such acquisition, Ormat Nevada will continue to develop the project on behalf of the owners.
If the development results in a resource that cannot support at least 30 MW, the parties are not obligated to close the acquisition and Ormat may continue development of the project by itself.
Under the JOA each party will own a 50% undivided interest in the project as tenants-in-common. To acquire its project interest, Nevada Power Company will pay 50% of the costs expended to the closing date of the acquisition plus a fee.
To enable the JOA closing, the parties will amend an existing Power Purchase Agreement (PPA) to reflect the joint ownership of the Project. Each party will be entitled to 50% of the production tax credit (PTC) or 50% of the Investment tax credit (ITC) as applicable. The agreement is subject to PUCN approval.
About Ormat Technologies
Ormat Technologies, Inc., is the only vertically-integrated company primarily engaged in the geothermal and recovered energy power business. The company designs, develops, owns and operates geothermal and recovered energy-based power plants around the world. Additionally, the company designs, manufactures and sells geothermal and recovered energy power units and other power-generating equipment, and provides related services. Ormat currently operates the following geothermal and recovered energy-based power plants: in the United States — Brady, Heber, Mammoth, Ormesa, Puna, Steamboat and OREG 1; in Guatemala — Zunil and Amatitlan; in Kenya — Olkaria; and in Nicaragua — Momotombo.
Loading...