The power plants are to be constructed by Ormat between 12 and 18 months from the effectiveness of the Power Purchase Agreement (PPA). The plants will be constructed on gas compressor stations along a natural gas pipeline in the Midwestern US.
The PPA has not yet become effective and is subject to certain conditions, including agreement for the purchase of the recovered energy and a variety of agreements necessary for start of construction. The company said it could not currently estimate when these additional agreements will be finalized.
Ormat estimates that construction costs for the power generation stations will be approximately $36 million. Upon completion of the construction of the power plants, Ormat expects to realize annual revenues of approximately $5 million from the sale of power generated as a result of this project.
Lucien Bronicki, chairman of the board and chief technology officer of Ormat Technologies, said: This PPA represents the first agreement entered into by Ormat Technologies for the sale of power from recovered energy generation. We believe that this segment of our business, from which we can generate clean electricity without the consumption of additional fuel, represents a substantial growth opportunity for Ormat.
