From Geothermal-biz.com Newsletter:

The Final Rules on Geothermal Resource Leasing and Geothermal Resources Unit Agreements which regulate geothermal energy production on public lands administered by the Bureau of Land Management (BLM) and the Minerals Management Service (MMS) go into effect on 1 June 2007.

The rules, which were written in response to the Energy Policy Act of 2005, mandate comprehensive changes to leasing and royalty policies to encourage geothermal energy use without imposing additional administrative burdens on industry or government agencies. The new rules require competitive leasing for geothermal development rights on nearly all federal lands designated for this type of development. If no bids are received, these resources would be available for leasing on a non-competitive basis for two-year periods.

The revamped MMS’s regulations offer an easy-to-use fee schedule (in lieu of royalties) for the direct use of geothermal resources that provides incentives to encourage the development and expansion of this alternative energy source. The MMS rules also simplify the royalty calculations for electrical generation leases by basing royalties on a percentage of gross proceeds from the sale of electricity. This would reduce industry’s administrative costs to comply.

The law mandates that 25 percent of the royalties from geothermal production be paid to the counties where the production occurs, increasing those local governments’ revenues initially by $4 million a year. MMS began making direct payments to counties shortly after the law was signed.

The BLM currently administers about 423 geothermal leases; 55 of those are producing geothermal energy, including 34 power plants. The bureau has been expediting the application process for geothermal leases, issuing almost 300 leases since 2001, compared to 20 leases from 1996-2001.

In addition, BLM is in the final stages of completing a new geothermal lease form for the Energy and Policy Act Leases and modifying the LR2000 land record data base to accommodate changes in geothermal regulations (new lease case types and action codes).

For more information, contact Kermit Witherbee, BLM National Geothermal Program Lead, Tel: (202) 452-0385, Kermit_Witherbee@blm.gov.

This is certainly good news for the localities around geothermal lease sites. Perhaps we’ll see more local support for projects as a result.

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Today in an orchestrated press event in Middletown, California, Calpine announced a few more details about it’s plan to bring up to 80MW more power online at the Geysers. The plan calls for a multi-rig, two-year drilling program and refurbishment of 8 steam turbines. Many dignataries were in attendance and spoke well of the plans.

This announcement is somewhat disappointing though as it doesn’t give any indication that Calpine will use waste heat for bottom cycling and preservation of mass on the property (we estimate Calpine could get as much as 70MW just from that activity with no drilling required.) Nor were there any other forward thinking aspects announced with this plan.

On the positive side, it’s nice to see Calpine investing in the Geysers, the crown jewel of their portfolio. Who knows, if they see some success with this program, perhaps they’ll decide to take another step. One thing is sure, 80MW more of capacity will be welcome in terms of climate impact (and it can’t hurt Calpine’s financials much either in the long term.)

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Yesterday we looked at a mobile, maritime based wind turbine in Wind Hunter. Today, we’ll take a look at an airship based, floating turbine system from Magenn. In both cases, this is a practice of taking the turbine to richer wind resources than are available with traditional, fixed terrestrial systems.

Here’s the Magenn system in action:


Effectively, the system consists of a cylindrical helium airship where the cylinder rotates in the wind. The ends of the cylinder are coupled to generators. The entire system is tethered between 100 – 330m (300-1000 feet) above ground level to a winch system that can raise and lower the turbine to access the best wind resource or pull the turbine to earth during extreme weather. In addition to helium, the craft is also designed to make use of the magnus effect – spinning spheres create lift as is seen with golf and base balls.

In terms of efficiency, the traditional wind formula of (power = 0.5 x air density x swept area x velocity-cubed) is multiplied by 0.5 (50%) to get the efficiency of these turbines to account for the difference in swept area of a blade system vs. the cylinder. This reduced efficiency is offset by increased capacity factor due to better wind resource at higher altitudes. One other interesting aspect of these turbines is that they begin function with wind speeds of 2m/sec (4.5mph) and operate through speeds of 28m/sec (60+mph) which also increases the capacity factor of the device.

There is a 4kw system in existence and the company aims to release 10kw systems in 2008 at a target price range of $30,000 to $50,000 per unit. The 10kw system will also require around $3,500 in helium (not included) and will need to be properly permitted with local and federal aviation authorities. Lest one think this is not feasible, the US government has (and does) operate surveillance platforms consisting of tethered helim airships at heights over 5km (15,000 feet.)

Who knows, perhaps we’ll see these systems tethered and producing sometime in the near future.

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Yesterday we ran across an interesting concept, WindHunter. Effectively, this is a mobile platform with nine large wind turbines dedicated to the manufacture of hydrogen. See an image of the concept below:

The idea is to refit old single hull oil tankers (now illegal for oil transport) to support a large platform on which will be placed large (5MW) wind turbines. The power generated will be used to electrolyze water separating it into hydrogen and oxygen (the plan calls for selling the hydrogen, but oxygen is valuable too.)

While this is a large and unproven project, the potential is apparent. Since the platform is mobile, it can travel to wind rich enviroments and orient itself to optimally harvest the wind resource. It can use the water as raw material for hydrogen production as well as for cooling. The hydrogen gas sales are projected to be near $25M per year at just 25% capacity factor for the platform. Modern land-based turbines are seeing capacity factors closer to 35% and with the mobility factor, it may be possible to boost the capacity factor of the WindHunter turbines beyond that threshold.

There are certain to be technical obstacles to overcome (engineering, storm worthiness, hydrogen transport, etc) but it’s certainly a concept that should get more examination and perhaps will come into being.

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In a brief press release today, Calpine announced its intent to add 80MW of capacity to the existing 725MW already in production at the Geysers. Details of the expansion program are to be announced on Thursday.

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