PROVO, Utah--(BUSINESS WIRE)--Raser Technologies, Inc. (NYSE: RZ - News), an energy technology company, today released an update on its geothermal activities and its PHEV project, updating stockholders, the media and the public on its progress and strategy.
Raser recently received final approval of a key permit from the New Mexico Oil Conservation Division (OCD) for injection of geothermal fluids for the Lightning Dock No. 1 project. Raser’s in-house geology and reservoir management team is conducting its final review of the Lightning Dock resource in anticipation of commencing drilling on site, pending the completion of funding for the project.
Raser is also in the process of negotiating a revision to its power purchase agreement (PPA) with the Salt River Project Agricultural Improvement and Power District. The revision is expected to include an increase in the expected output from the Lightning Dock project as well as an increase in the price of energy under the PPA.
Thermo Update
Raser is now in the final stages of testing the fifth production well needed for the completion of Thermo No. 1 as part of its plan to bring the plant to full capacity by the end of the year. Raser is also preparing to re-work existing wells and is taking other steps to optimize the operations of the plant, including working with Pratt & Whitney Power Systems to make certain modifications to the PureCycle units on site.
As recently announced, Raser is in the process of amending its agreements with Merrill Lynch, the tax-equity partner in the Thermo No. 1 plant, and Prudential, the debt holder. These amendments will allow the Thermo No. 1 project to take full advantage of the 30 percent federal grant for renewable energy projects under the American Recovery and Reinvestment Act of 2009.
Raser is also actively planning future phases of development utilizing the Thermo resource which is estimated to contain over 200 MW of potential power. These efforts include moving forward with permitting, environmental compliance, engineering, transmission and interconnection, and negotiation of a pre-paid power purchase agreement with the Southern California Public Power Authority (SCPPA).
SCPPA Update
Raser continues to progress in negotiations with SCPPA on the previously announced pre-paid power purchase agreement. The expected structure of the agreement anticipates Raser building out 110MW over a three- to four-year period at its Thermo, Utah site in a multi-phase development via multiple power purchase agreements. When finalized, this transaction is expected to provide the financial support necessary for the funding of Raser’s roll out plan of 40MW per year over the next three years.
Funding
As traditional financing markets were struggling late in 2008 and early this year, Raser was actively exploring alternative funding sources to mitigate the impact from the global economic crisis on its business. Raser has pursued a variety of alternative funding sources, including pre-paid power purchase agreements, project joint ventures, green energy funds, lines of credit and other sources to assist Raser’s projects going forward. Additional industry funding is becoming available through government grants, loan guarantees, and potential public-private partnerships.
The geothermal industry has seen a number of key new players on both the equipment side and the construction side that Raser believes will be important partners for the financing of projects going forward. Raser’s Principal Executive Officer, Dick Clayton, gave one of the keynote addresses at the Geothermal Resources Council annual meeting in Reno, Nevada on October 5, 2009, and discussed these key new entrants into the geothermal industry. Mr. Clayton noted that several large contractors have shown interest in establishing partnerships to finance future projects, which would help bridge the gap between early development and long-term project financing. Mr. Clayton also discussed several new equipment suppliers which are providing additional flexibility in geothermal equipment and showing a willingness to assist with financing of projects. Raser is working to tap into these opportunities in order to further develop its geothermal resources.
New High Efficiency Generation Units
Raser is in discussion with several equipment manufactures which provide larger, high-efficiency binary-cycle turbines and generators. Among these is Pratt & Whitney Power Systems (PWPS) which recently acquired Italian turbine manufacturer Turboden and is planning on introducing a new, larger geothermal unit to the market soon. Raser anticipates that these larger units, from PWPS and others, will significantly improve the economics of future projects. Raser is encouraged that these new equipment options may improve Raser’s returns on future projects, while still meeting Raser’s strategy of rapid deployment.
PHEV Update
Raser is extremely pleased with the progress of its electric powertrain technology following successful demonstrations of the Company’s H3 Hummer E-REV on CNBC, in Washington, D.C., and in California with Governor Arnold Schwarzenegger. Following these successful demonstrations, and the announcement that the full-size 6,000 pound, four wheel drive, luxury SUV H3 Hummer E-REV can deliver approximately 140 miles per gallon and has driven more than 50 miles while limiting usage to approximately 60% of the battery pack’s stored energy and zero gasoline, the Company has had discussions with several automakers regarding potential partnerships.
In addition:
Raser is completing its final technical review of its drivetrain technology with General Motors and anticipates moving to the next phase of its commercialization initiatives.
The Company’s project with Pacific Gas and Electric (PG&E), which is related to the deployment of clean, fuel efficient full-sized vehicles continues to progress. The Company has completed the proof of concept phase and is beginning alpha test phase.
With the Company’s success in developing large, efficient SUVs using its electric powertrain technology, it is now embarking on an initiative to develop systems for pickup trucks and other larger vehicles.
Kraig Higginson, Chairman of Raser Technologies, commented, “Raser has many exciting prospects for future developments, and while the financing markets have been challenging in recent months, we are seeing positive movement. We are also beginning to see federal money allocated to renewable energy projects funnel through the system, and we intend to take full advantage of these funds by means of grants and loan guarantees. In addition, there is exciting new, second generation power generation technology that is available to us that we anticipate implementing to boost power production and benefit our bottom line. Also, our PHEV technology positions us well to capture market share in the new emerging auto industry, with disruptive technology that can enable trucks and SUVs to achieve over 100 MPG.”
Raser Technologies Provides Update on Its Geothermal Activities and Its PHEV Project - Yahoo! Finance 
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