Raser to Deliver Renewable Power to Salt River Project
Raser Technologies, Inc. of Provo, Utah, said June 12 that it has executed a power purchase agreement (PPA) with the Salt River Project Agricultural Improvement and Power District, a major utility district serving the Phoenix, Ariz., area, for Raser's Lightning Dock geothermal power plant in New Mexico.
The agreement will provide for the delivery by Raser of approximately 10 megawatts (MW), or enough electricity to power approximately 5,500 homes in the Phoenix area, of renewable geothermal power for 20 years. Under the agreement, Raser plans to begin delivering electricity on or before Dec. 15, 2008.
The agreement provides for a stated selling price with annual increases over the term of the agreement. It also provides for an increase in the price per MWh if the federal production tax credit for renewable power is not extended and the project does not qualify for the production tax credit in its current form. The Salt River Project has the right of first refusal for any additional power produced by the Lightning Dock project if it is expanded.
The Lightning Dock project is one of the oldest known geothermal resource areas in New Mexico and has been well studied for more than 20 years. The project has 41 wells exhibiting temperatures from 250 to more than 300 degrees (F). Third-party geological studies have verified that sufficient heat and flows are available to produce geothermal power. Raser intends to initially build a 10-MW power plant, and then expand the facility at a later date.
"We see an increasing demand from utilities and municipalities for green power which reduces emissions and reduces our energy dependence on fossil fuels," said Maddie Reicher, Evolution Markets Inc., an environmental and energy brokerage firm that facilitated the transaction. "A number of additional states have recently adopted renewable portfolio standards mandating that a minimum percentage of power supplied by these utilities to their customers come from renewable energy sources like Raser's geothermal project in New Mexico. Raser is well positioned with its geothermal energy pipeline approach to help them meet the growing demands from businesses and residents and meet the higher standard of renewable energy use."
"We are excited to support SRP's commitment to expand their use of renewable energy," stated Brent M. Cook, Raser's Chief Executive Officer. "Our geothermal power plants are designed to provide baseload renewable energy with virtually no harmful emissions."