Raser Technologies Lightening Dock Geothermal Power Plant
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July 30 – Raser Technologies Inc (NYSE:RZ) announced on July 21 that it had signed a commitment letter with Merrill Lynch for the tax equity funding and financing of its Lightning Dock geothermal power plant. The commitment letter provides for roughly $27 million of tax equity capital and up to $43 million of construction and debt financing for Raser Technologies’ first commercial geothermal project to be built in New Mexico.
The actual amount of funding that Raser Technologies will receive will be determined by both the parties and the negotiation of definitive financing documentation. According to the commitment letter, roughly $16 million of tax equity will be used to pay down construction debt funding at the time the plant is put into service. Merrill Lynch may ask other partners to contribute to Raser Technologies’ tax equity. This will enable other companies to also profit from the several tax benefits offered to a renewable energy project.
Raser Technologies’ chief executive Brent M. Cook said that Merrill Lynch has exhibited “bold leadership with their financial commitment to clean, baseload, renewable energy.” The company’s pipeline of geothermal projects would help to curb carbon emissions as well as provide power “to an area with increasing energy demands,” Cook added.
Raser Technologies had on July 3 announced its plans to construct the Lightning Dock geothermal electric generation plant on 2,500 acres in Hidalgo County near Lordsburg. The plant is expected to break ground before the end of the year and should start generating 10 to 11 megawatts of electrical power with zero emissions. This amount of electrical power is sufficient to provide energy to approximately 5,500 homes in the region. Trading Markets quoted Richard Putnam of Raser Technologies’ investor relations department as saying that apart from providing geothermal power, the plant will create about 100 jobs during the construction phase and roughly 12 jobs during the operation phase.
Following the announcement of the plant, Raser Technologies has signed an agreement with the Arizona utility, Salt River Project, to sell 11 megawatts of energy to the Phoenix market for the next 20 years.
Raser Technologies said that the geothermal plant will use the PureCycle® geothermal system technology from UTC Power, a United Technologies Corp. (NYSE:UTX) company. The company has already started taking delivery of the UTC power generating units and would be installing 50 units at the project site, Raser Technologies added.
Alternatio Cirqui, EconomyWatch.com Energy Correspondent
