Geothermal

by Debra Fiakas CFA Last week US Geothermal (HTM:  AMEX), a power generator from geothermal projects in California, Oregon, Nevada and Idaho, made an appearance at the Marcum Microcap Conference in New York City.  The company stood out among most of the companies appearing in Marcum’s so-called ‘energy track’ as one of the few with solid revenue and profits.  US Geothermal reported a net profit of $1.9 million on $28.8 million in total sales in the twelve months ending March 2014.  The net profit is commendable, but what I find more interesting is the conversion of 30%...

Meg Cichon Geothermal well photo via Bigstock With climate threats and increased energy demand, South American countries are set to develop their vast geothermal potential. Will developers be able to acquire investment and favorable policy? If any part of the world should be concerned about the effects of climate change, it is South America. Despite contributing some of the lowest emissions globally, many of the countries in the region are As South America’s population is expected to rise 72% by 2035, the impact of climate...

Jennifer Delony Reno, Nev.-based Ormat Technologies (ORA) is seeking mergers and acquisitions that will help the company enhance its geothermal projects with energy storage technologies, Ormat CEO Isaac Angel said on Nov. 4. “On the storage solutions side, we are progressing well,” Angle said during a 3Q15 earnings webcast. “I’m very optimistic that we will be able to add a lot of MW … and profitability to our existing power plants.” Angle said that he also is optimistic that the company will secure a deal soon that will initiate Ormat’s energy storage strategy. “We’re almost there,” he said....

By Dana Blankenhorn Of all the energy harvesting technologies out there, geothermal remains the most maddening. In theory, there should be more than enough energy below our feet to power our world, and it should be cost-competitive for a fraction of the investment needed in wind or solar. In theory. Right now, the extraction of geothermal energy in the U.S. remains tied to Nevada and California, where the heat is close enough to the surface and in stable enough formations that a drill can reach it without the heat dissipating quickly. This has caused investors to sour on...

Dana Blankenhorn Most renewable energy companies specialize. Solar companies do solar. Wind companies do wind. Geothermal companies do geothermal. Biomass companies do biomass. But a small Canadian merger challenges that assumption. Magma Energy (MGMXF.PK), a geothermal company, said it will spend about $100 million in stock to buy Plutonic Power (PUOPF.PK), which has wind and hydropower projects, and ambitions to get into solar. The combined companies will go by the name Alterra Power. Both companies are based in Vancouver. Size really does matter, crowed Magma CEO Ross Beatty on a conference call announcing...

by Debra Fiakas CFA U.S. Geothermal (HTM:  AMEX) is scheduled to report third quarter 2013 financial results on November 15th, taking every day allowed to a public company to reveal the fruits and labors of a quarter.  There will be plenty to talk about in the conference call with analysts and investors.  USG closed a loan financing to support the first phase of its San Emidio geothermal power project in Nevada.  The loan valued at $30.7 million bears a fixed interest burden of 6.75% will replace a $25 million construction loan for the project and supply working capital...

US Geothermal Inc. (UGTH) has initiated a contract with Ormat Technologies (ORA) to begin building a binary cycle geothermal power plant that is designed to deliver 10 MW monthly average electrical power to Idaho Power Company under a 20-year term power purchase agreement.

Tom Konrad CFA Uncertainty surrounding the damage caused by a sulfur fire at LSB Industries‘ (NYSE:LXU) chemical facility Tuesday has brought the stock down $5 from Monday’s close, although the company was already well-valued and had just beaten analyst’s expectations for its first quarter results. This is extremely short-sighted of investors, who are no doubt spooked by the lack of information about the extent of the damage.  However, we have enough information to make a reasonable estimate as to the damage to LSB’s profits.  As I outlined Tuesday night, we know: The facility is insured for both damages and work stoppage....

Tom Konrad CFA My take-aways from the GEA Finance Forum After a long time lost in the proverbial desert of high capital costs and few financiers willing to step up, a number of geothermal companies made breakthroughs last fall.  The Department of Energy (DOE) loan guarantees for geothermal power development began to come through, and financiers were beginning to step up.  Nevada Geothermal Power (NGLPF.OB) announced a deal with Ormat (ORA) in which Ormat will earn a share of Nevada Geothermal's Crump Geyser property by paying for and financing most of the development costs,...

Tom Konrad CFA Geothermal power generation has several advantages over higher profile alternative energy such as wind and solar, but gets much less attention.  Part of the lack of recognition for Geothermal power arises from a confusion with the technology variously called Geoexchange, Ground Source Heat Pump, or Geothermal Heat Pumps.  Geoexchange uses the near constant temperature of the soil a few feet to a few hundred feet below the ground to heat and cool a building.  According to the Environmental Protection Agency, Geoexchange is the most efficient way to heat and cool a building, and...

Ormat Technologies (ORA) announced that an Ormat subsidiary signed an agreement to purchase from CDC Group plc., a 14.09% partnership interest (13.67% on a fully diluted basis) in Orzunil I de Electricidad, Limitada (Orzunil), which owns the Zunil Geothermal Project in Guatemala. CDC Group's investment in this project has been managed by Globeleq, an emerging markets power company. As a result of this acquisition, Ormat's annual net income from the Zunil project is expected to increase by approximately $0.6 million on a full year basis.

Charles Morand The DOE made public earlier today the amount of money that will awarded to clean power projects in lieu of the usual tax breaks: $3 billion. This will allow project proponents to receive a direct cash grant now instead of a Production Tax Credit or an Investment Tax Credit later on. The guidance document notes the following: "Section 1603 of the Act’s tax title, the American Recovery and Reinvestment Tax Act, appropriates funds for payments to persons who place in service specified energy property during 2009 or 2010 or after 2010 if construction began...

Raser Technologies (NYSE:RZ) did not get the hoped-for DOE loan guarantee.   The company still has good long term prospects, but the short term upside chances are much weaker, prompting me to sell in the hope of buying back in after a general market sell-off. Raser Technologies (NYSE:RZ) dropped from $2.10 to $1.95 on September 1st, prompting a regular reader to leave a comment asking me if it was time to sell on the original Raser article. (Because he's a regular, he knows my policy of preferring to answer questions posed as comments on the blog to email comments: At...

by Debra Fiakas CFA Geothermal power generator US Geothermal (HTM:  NYSE) came up short in reporting financial results for the first quarter ending 2017  -  at least from the perspective of the four analysts with published sales and earnings expectations for the company.  Operating revenue of $8.4 million slipped slightly from the same period a year ago, but produced slightly lower net income of $1.1 million.  The company’s share was $260,000 or a penny per share.  Not good enough say the analyst’s who were collectively looking for two pennies per share in earnings! Missing earnings expectations has...

by Debra Fiakas CFA Calpine Plant at The Geysers.  Photo Source: Calpine In the article “Is Ormat Technologies Misunderstood?”, I outlined a few performance measurement issues, but left out of the story Ormat’s position in the relative position in the geothermal industry.  Naturally I received comments from readers about why I made no comparison of Ormat to Calpine Corporation (CPN:  NYSE), the largest U.S. generator of electrical power using geothermal sources.  On a go-forward basis Calpine shares are valued about the same as Ormat Technologies,...

"Experts generally agree that our current reliance on fossil fuels is unsustainable. Already oil is near $50 per barrel, and the great millions of Chinese and Indians destined to take to the road in the next decades have not yet gotten behind the wheel." This week Newsweek has written several special reports about alternative energy in all its forms. All of these reports can be found at the following link.