Monday, October 03, 2011

Breaking: Another planet-healing, taxpayer-financed company in trouble

A U.S.-Backed Geothermal Plant in Nevada Struggles -
WASHINGTON — In a remote desert spot in northern Nevada, there is a geothermal plant run by a politically connected clean energy start-up that has relied heavily on an Obama administration loan guarantee and is now facing financial turmoil.

The company is Nevada Geothermal Power, which like Solyndra, the now-famous California solar company, is struggling with debt after encountering problems at its only operating plant.
Geothermal projects in general have encountered complications in recent years. They are a much riskier enterprise than solar panels or wind turbines, because the drilling can take several years and the power output is not guaranteed until the work is complete.

That explains why in recent months, shares of geothermal companies have collapsed, dropping far more than the shares of most renewable energy businesses. Nevada Geothermal, as of the market close Friday, was trading at 10 cents a share, down from $1.24 when its plant opened in 2009.

Obama administration officials knew about most of these difficulties before the Energy Department agreed in September 2010 to partly guarantee a second major loan to Nevada Geothermal, worth $98.5 million.

No comments: