Sparks company to buy Steamboat geothermal plants

A purchase agreement scheduled to close July 31 would transfer ownership of four geothermal power plants at the base of the Steamboat Hills to Sparks-based ORMAT Nevada, Inc.

The site, known as the Steamboat Geothermal Complex, is southwest of the intersection of Highway 395 and Mount Rose Highway.

The pending $32.5 million purchase would include the Steamboat 2 and 3 plants from Far West, that together generate 28 megawatts. A megawatt can supply power for 750 to 1,000 homes.

The deal would also include 120 acres at the site that has geothermal development potential, according to Rany Raviv, an ORMAT vice president of business development.

The other two plants - Steamboat 1 and 1A - were purchased last month from majority owner U.S. Energy and Far West for $1.15 million. The plants generate a combined 7 megawatts.

Raviv said the four plants have contracts with the Northern Nevada utility Sierra Pacific Power Co. to supply energy and standby capacity over the next 18 to 20 years. The plants generate about $15 million in annual revenues that will gradually increase, in accordance with escalation clauses in the agreements with the power company.

Geothermal power is a renewable electricity source using steam and hot water to harness underground heat.

Although completion of the sale would provide ORMAT ownership of the existing plants, Reno-based Advanced Thermal Systems plans to construct two geothermal projects in the area. Both will generate power with Kalina cycle technology, a closed-loop system that employs improved heat-exchange methods. The existing Steamboat plants use less-efficient, closed-loop systems.

Construction of the 44-megawatt ATS Steamboat 4 project is expected to start this summer and be completed in two years.

The other project will generate 11 megawatts, used in part to power the nearby planned Redfield Campus of the University of Nevada, Reno.

Yankee-Caithness Joint Venture operates an additional geothermal plant uphill from the Steamboat Geothermal Complex that is not part of the ORMAT transactions.

Both areas are part of a larger region of known geothermal potential that includes the Steamboat Hills and extends north to the new South Valleys library, east to the old Brown Elementary School, south to Joy Lake Road and west to the Callahan Ranch vicinity.