Utah, United States [RenewableEnergyWorld.com] Raser Technologies Inc. has reached agreements that amend the financing arrangements with the senior project debt holders and the project tax-equity partner for its Thermo No. 1 geothermal energy project in Utah.
“We are extremely pleased with the results of these amendments and note that this should improve the overall economics of our first power plant by allowing us to apply for the 30% U.S. Treasury grant applicable to renewable energy projects under the American Recovery and Reinvestment Act of 2009. Through this amendment, Raser will become 100% owner of the Thermo No. 1 power plant,” said Richard Clayton Raser’s principal executive officer.
Under the new agreement, Raser will be the sole owner of the Thermo No. 1 project and future financing commitments between Raser and the tax equity partner have been canceled. Raser estimates that the project will qualify to receive approximately US $33 million from the U.S. Treasury grant. Any amounts received from the grant will be used for payments to all members of the Thermo No. 1 financing partnership. Raser would receive $3.8 million immediately upon Thermo No. 1 receiving payment from the Treasury.
Raser expects to apply for the treasury grant within the next several days. The grant application includes, among other things, a certificate of independent accountants relating to the capital costs of the project and a certificate of an independent engineer stating that the project was placed in service in 2009. The Treasury Department is required to pay the grant proceeds within 60 days of the application being deemed complete.
As part of the amendments, the timing for final performance testing and completion of the Thermo No. 1 Project has been extended to February 15, 2010. Raser will continue ramping up to full capacity and anticipates delivering approximately 10 megawatts (MW) of geothermal power from its plant to the City of Anaheim before the performance testing date.