Tuesday, 10 November 2009

Grants of $235m put thermal and wave power to test

Sydney Morning Herald
Saturday 7/11/2009 Page: 2

WAVE and geothermal technologies have been given a much needed boost under a $235 million round of renewable energy grants from the Federal Government. The Energy Minister, Martin Ferguson, announced the grant money for four commercial-scale renewable energy demonstration projects in Canberra yesterday. In an expected decision, two South Australian geothermal projects received significant grants - $62 million for Petratherm's 30 MW plant and $90 million for GeoDynamics's 25 MW multi-well power project.

The announcement sent both GeoDynamics and Petratherm share prices soaring. GeoDynamics rose 8c to 91c, or 9.6%, and Petratherm rose 7.5c to 44c, or 20.5% yesterday. The commercial manager of GeoDynamics, Alistair Webb, said the company was ready to proceed with the first stage in developing the 25 MW project. The Cooper Basement project will be the world's first commercialsise demonstration of a multi well hot fractured rock power plant.

Mr Webb said the project would need nearly $300 million by its completion in 2013 but the government funding - staged over the life of the projects - would make finding money much easier. We are not in need of capital straight away, but it is on the radar," Mr Webb said yesterday. He said the project would aim to demonstrate the technology on a commercial scale and drive the price per MW down so geothermal could compete with other energy options on the market.

Speaking in Canberra yesterday, Mr Ferguson said he placed the same level of importance on the commercial development of geothermal as carbon capture and storage technologies. If geothermal was not commercially demonstrated by 2015-2020, Australia would have a big challenge in moving to a low-carbon energy market in the face of climate change, he said.

A 19-MW wave project in Portland, Victoria, led by the US-based Ocean Power Technologies and Leighton Holdings, received $66.5 million. The project trumped more fancied West Australian projects, which the the director of OPT Australasia, Gilbert George, credited to its partnership with Leighton Holdings. Mr George said the project would need to raise a further $100 million at least before its full realisation, but he was "very excited" about the grant's potential to help this along.