RE: Question for GreenandGoldTake a look at Mighty River Power, a New Zealand renewable power producer, about 66% hydro, 31% geothermal and a touch of wind power. The company has been doing very well recently, its EBITDA and profits up big based upon increasing geothermal generation. Mighty River presently has a net equity interest in 267 MW of producing geothermal power, all in NZ.
For the six months ended 12/31/10, the company had EBITDA of NZ 223.6 million (US $164.37 million), up 22% from the previous year, and net profit of NZ $85.2 million (US $62.6 million), up 15.8% from the previous year. According to its press release the higher EBITDA and net profit was mostly due to the recent commissioning of the 140 MW Nga Awa geothermal plant.
The company is providing guidance that its fiscal year 2011 EBITDA will likely increase to NZ $435 million (US $320 million). Remember that roughly 30% of this EBITDA is coming from geothermal sales, this works out to about US $96 million.
That's 267 MW of geothermal capacity producing $US 96 million of EBITDA, which is pretty good considering that the power is only selling for US $79 per MWhr. The rates in Nicaragua and in the Western US for PPA's currently being signed are significantly higher (in the $90's I believe).
Mighty River is spending US $741 million dollars to bring online additional geothermal plants in New Zealand and it's created a special entity, Geo Global Energy, to invest in geothermal projects in the US and Latin America. It just invested $100 million in a California geothermal project. Mighty River is a state-owned enterprise. Why would it be investing in US and Latin American geothermal so aggressively? Because the values are excellent and because their experience tells them that geothermal is a growing, profitable business.