Ormat Technologies Inc. (NYSE:ORA) today announced that its wholly owned subsidiary, Ormat Nevada, Inc., signed an agreement with RET Holdings, LLC to sell the Heber Solar project in Imperial County, California for $35.25 million. Ormat received the first payment of $15 million with the remainder expected to be paid in the second quarter of 2014, subject to fulfillment of certain milestones. As a result of the sale, Ormat will record a pre-tax gain of approximately $7.0 million.
The project, which started development in 2011, has a 20-year power purchase agreement (PPA) with the Imperial Irrigation District (IID) for 10 MW of solar photovoltaic (PV) energy.
“Our goals in the development of the Heber Solar project were to benefit from the synergies between our existing geothermal assets and solar development, to apply our development and experience as engineering, procurement and construction contractor in utility scale solar plants and to develop profitable projects. The development up to this point and the transaction that we have just concluded with RET Holdings allowed us to accomplish all three goals, ” said Dita Bronicki, chief executive officer of Ormat. “The Heber Solar project, Ormat’s first PV project in the U.S., was developed in a cost-effective way. We plan to continue monitoring the solar market and pursue opportunities for developing PV plants in locations where we can offer competitively priced power generation.”
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“RET is pleased to acquire this high-quality asset and looks forward to growing its business with new and existing asset partners, ” said John A.
Bohn, Chief Executive Officer and Chairman of RET.