Raser Technologies announced on June 26 that it has signed a term sheet with Southern California Public Power Authority (SCPPA) to sell a potential 110 megawatts (MW) of geothermal-generated electricity in a pre-paid power purchase agreement.

Power will be purchased from Raser’s Thermo, Utah site, where additional power plants will be built over a three-year period.

The term sheet establishes the basic terms of a power purchase agreement (PPA) but is not as binding. Raser will develop 110 MW of geothermal-generated electricity, which will be purchased by the SCPAA. The SCPPA will be paying up-front for power yet to be generated that the company will use to pay a reduced rate for remaining electricity to be delivered. The term sheet is non-binding, and either company can elect to eliminate it at any time without liability to either company.

With pre-paid PPAs, energy developers can take advantage of municipalities that are able to borrow at favorable rates so they can pay reduced up-front power rates. Municipalities benefit by securing price stability of electricity over the life of the agreement, which also enables them more access to renewable energy. Access to favorable lending rates enables Raser to get reasonable funding at difficult economic times, and allows the company some flexibility in planning its commercial geothermal energy projects.

The Southern California Public Power Authority consists of 11 municipal utilities and one irrigation district. SCPPA members deliver electricity to about two million billed customers in an area of 7,000 square miles and a total population of six million. Members include utilities covering Anaheim, Azusa, Banning, Burbank, Cerritos, Colton, Los Angeles, Pasadena, Riverside, Vernon, and the Imperial Irrigation District. The SCPPA currently has five electricity generation projects and three transmission projects that bring electricity sourced from Arizona, Nevada, New Mexico, Texas, Utah, and Wyoming.

Raser Technologies focuses on licensing geothermal technology and developing geothermal energy projects. Its power systems segment develops clean, renewable geothermal energy power plants, incorporating its own Symetron™ technology, and licensed heat transfer technology.

Raser has also developed Symetron™ technology for extended-range plug-in-hybrid vehicle solutions. Symetron™ technology is used to improve the torque density and efficiency of electric motors and drive systems used in electric and hybrid-electric vehicle power trains and industrial applications.

Raser Technologies Inc. is headquartered in Provo, Utah. The company is listed on the NYSE as RZ. Stock was up on the June 26 trading day by 10.66%, closing at $4.05.


-  Mike R. Lopez

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¹ http://www.rasertech.com