Geothermal Energy Projects coming to US
http://blogs.wsj.com/energy/2007/09/05/glitnir-goes-geothermal/
September 5, 2007, 2:52 pm
Glitnir Goes Geothermal
Posted by Mark Gongloff
Steve Gelsi has this report on plans for a big investment in geothermal projects:
Glitnir said it’s planning to play a visible role in an estimated $40 billion financing push behind geothermal energy projects in North America by 2025 as the Nordic financial group eyes growth in the business of harnessing heat from the earth to produce electricity. (This paragraph has been corrected; see below.)
iceland_art_200_20070905145556.jpg
The Blue Lagoon in Grindavik, Iceland; the supposedly soothing waters are created by runoff from a geothermal plant. (AP)
Taking aim at a competitive financing market for alternative energy deals, Glitnir will attempt to outflank the likes of Credit Suisse, General Electric, Siemens and others by focusing on geothermal.
“There’s competition on all angles…the challenges are numerous, but the opportunities huge,” said Arni Magnusson, managing director of sustainable energy for Glitnir. “We haven’t seen any big banks with a singular interest as we have. We’ve decided to narrow our focus down to geothermal, and the U.S. market is on top of the list.”
The firm is readying a formal announcement of a financing deal of more than $10 million behind Iceland America Energy Inc., a geothermal specialist with a deal to provide energy to PG&E through the Truckhaven project in California, Magnusson said.
Other recent deals include a $19 million financing of Western GeoPower Corp., a $23 million financing round for ThermaSource in Santa Rosa, Calif., and a $20 million debt round to help Nevada Geothermal Power Inc. conduct drilling operations.
With offices throughout northern Europe, Glitnir trades on the stock exchange in Iceland, a country of only about 310,000 people that gets nearly all of its electric power from geothermal energy. Although geothermal is clean and cheap once plants are built, it occasionally falls victim to earthquakes and volcanic activity, which can reroute subterranean hot spots. In most cases, however, geothermal energy stays put for hundreds of years at a time.
Glitnir projects an annual U.S. geothermal electricity market of $11 billion by 2025 from about $1.8 billion now, with geothermal potentially providing up to 20% of California’s electricity needs, 60% of Nevada’s and 30% of Hawaii’s.
Glitnir hung out its shingle in the U.S. by opening a branch office in New York City and sponsoring its first Steam of Opportunities conference at the Palace Hotel. The Iceland and Norway-based firm plans to position itself as a development partner through equity raising, merger-and-acquisition advising, debt financing, and business origination for clients and investors.
By tapping into heat from the earth’s crust, geothermal power plans emit 35 times less carbon dioxide per kilowatt produced than the average U.S. coal-fueled power plant, Glitnir said.
Corrections and Amplifications: An earlier version of this post incorrectly said Glitnir alone plans to spend $40 billion on geothermal energy by 2025.
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September 5, 2007, 2:52 pm
Glitnir Goes Geothermal
Posted by Mark Gongloff
Steve Gelsi has this report on plans for a big investment in geothermal projects:
Glitnir said it’s planning to play a visible role in an estimated $40 billion financing push behind geothermal energy projects in North America by 2025 as the Nordic financial group eyes growth in the business of harnessing heat from the earth to produce electricity. (This paragraph has been corrected; see below.)
iceland_art_200_20070905145556.jpg
The Blue Lagoon in Grindavik, Iceland; the supposedly soothing waters are created by runoff from a geothermal plant. (AP)
Taking aim at a competitive financing market for alternative energy deals, Glitnir will attempt to outflank the likes of Credit Suisse, General Electric, Siemens and others by focusing on geothermal.
“There’s competition on all angles…the challenges are numerous, but the opportunities huge,” said Arni Magnusson, managing director of sustainable energy for Glitnir. “We haven’t seen any big banks with a singular interest as we have. We’ve decided to narrow our focus down to geothermal, and the U.S. market is on top of the list.”
The firm is readying a formal announcement of a financing deal of more than $10 million behind Iceland America Energy Inc., a geothermal specialist with a deal to provide energy to PG&E through the Truckhaven project in California, Magnusson said.
Other recent deals include a $19 million financing of Western GeoPower Corp., a $23 million financing round for ThermaSource in Santa Rosa, Calif., and a $20 million debt round to help Nevada Geothermal Power Inc. conduct drilling operations.
With offices throughout northern Europe, Glitnir trades on the stock exchange in Iceland, a country of only about 310,000 people that gets nearly all of its electric power from geothermal energy. Although geothermal is clean and cheap once plants are built, it occasionally falls victim to earthquakes and volcanic activity, which can reroute subterranean hot spots. In most cases, however, geothermal energy stays put for hundreds of years at a time.
Glitnir projects an annual U.S. geothermal electricity market of $11 billion by 2025 from about $1.8 billion now, with geothermal potentially providing up to 20% of California’s electricity needs, 60% of Nevada’s and 30% of Hawaii’s.
Glitnir hung out its shingle in the U.S. by opening a branch office in New York City and sponsoring its first Steam of Opportunities conference at the Palace Hotel. The Iceland and Norway-based firm plans to position itself as a development partner through equity raising, merger-and-acquisition advising, debt financing, and business origination for clients and investors.
By tapping into heat from the earth’s crust, geothermal power plans emit 35 times less carbon dioxide per kilowatt produced than the average U.S. coal-fueled power plant, Glitnir said.
Corrections and Amplifications: An earlier version of this post incorrectly said Glitnir alone plans to spend $40 billion on geothermal energy by 2025.
Permalink | Trackback URL: http://blogs.wsj.com/energy/2007/09/05/glitnir-goes-geothermal/trackback/
Save & Share: Share on Facebook | Del.icio.us | Digg this | Email This | Print
Read more: Geothermal, Investing
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