Government, Private Sector Join to Make Neal Hot Springs Geothermal Power Plant a Reality

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Photo Credit: US Geothermal
Pioneers heading west on the Oregon Trail by stagecoach stopped to relax and enjoy the hot waters at Neal Hot Springs 90 miles northwest of Boise, Idaho. In the near future, the area will be the site of Oregon’s first commercial-scale geothermal power plant.

A public-private collaboration, Idaho’s US Geothermal Inc., equity investor Enbridge Inc. and the US Dept. of Energy joined together to complete financing of the $130-million Neal Hot Springs project, which is expected to come online in late 2012 with a capacity of 25 megawatts (MW).

Located near the eastern Oregon town of Vale, Neal Hot Springs’ geothermal resource resides at a depth of some 2,800 feet below the earth’s surface where a reservoir of hydrothermal fluid ranges in temperature from 311-356 degrees Fahrenheit.

A $96.8 million low-interest loan guarantee through the US Dept. of Energy’s Loan Programs Office paved the way for the project to move forward. The loan guarantee falls under the Dept. of Energy’s Title XVII program, which was created with the passage of the Energy Policy Act of 2005. The Federal Financing Bank will fund the loan, which makes up 3/4 of the project’s financing. Enbridge Inc.’s equity investment provides the remaining financing and equity base.

Project partners were joined by Oregon Senators Ron Wyden and Jeff Merkley, and Idaho Senator Mike Crapo in Boise, Idaho August 19 as they gave a public briefing on the project.

Wyden praised the federal government’s pivotal role in the zero-emissions, renewable energy project, which will tie-in to the Pacific Northwest power grid, while Dept. of Energy Loan Programs Office executive director Jonathan Silver officials and private sector partners highlighted the innovative technology that will be used, as well as the green jobs and work that will be generated in the US.

US Geothermal expects that some 95% of power plant’s infrastructure and parts will be supplied by US-based manufacturers. Houston’s TAS Energy, Inc. is providing high-efficiency modular energy systems for the geothermal plant. Approximately 150 construction jobs and over a dozen permanent jobs are expected to be created during the project’s 18-month construction phase.

US Geothermal’s largest geothermal power plant project to date, management intends to continue efforts to better define the full extent and size of Neal Hot Spring’s geothermal resource base with an eye towards determining if power generation could be expanded.

“Developing our nation’s energy resources is a critical step to put Americans back to work and allow our nation to become more energy independent,” Idaho Senator Mike Crapo said.

“I have worked with my Senate colleagues to sponsor three bills that promote and expand the use of geothermal energy and I am proud that an Idaho-based company, U.S. Geothermal, and resources from Northwest states, including Idaho, are leading the way in the advancement of geothermal energy in the U.S.”

Executive director of the Renewable Northwest Project Rachel Shimshak linked the Neal Hot Springs project to the region’s pioneering role in developing large-scale hydropower resources generations ago. “The Northwest region has a long history of tapping our abundance of renewable energy resources, and the Neal Hot Springs project is an exciting new example of vision and smart clean energy investment,” Shimshak said.

“We applaud U.S. Geothermal for this significant milestone, marking a major step in our region’s forward push toward a clean energy future. Our communities, environment and local economies will equally benefit.”

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