The Cove Fort Hybrid Plant
Ormat Technologies Inc., an Israeli geothermal energy company providing alternative energy solutions, has acquired the Cove Fort geothermal power plant in Utah for $271 million.
Geothermal power plants are a type of renewable energy power plant that use the Earth’s heat to generate electricity. There are three main types of geothermal power plants: dry steam, flash steam, and binary cycle. Binary cycle geothermal power plants use a secondary fluid with a lower boiling point than water. The hot water from the underground reservoir is used to heat the secondary fluid, which then vaporizes. The steam from the secondary fluid is then piped to a turbine to generate electricity.
Geothermal power plants have a number of advantages over other types of power plants. They are a renewable energy source, meaning that they will never run out of fuel. They are also very clean, producing almost no emissions. Geothermal power plants are also very reliable, as they are not affected by weather conditions.
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Geothermal power plants are used in many countries around the world, including the United States, Iceland, New Zealand, and the Philippines. The United States is the world’s largest producer of geothermal electricity, with over 3.7 gigawatts of installed capacity.
The Cove Fort Hybrid Plant was the world’s first commercial geothermal-hydro hybrid power plant. Located in Beaver County, Utah, it is a medium-enthalpy geothermal plant that uses innovative binary cycle technology. The installed capacity is 25 MW and can generate up to 160 GWh of energy output each year while avoiding CO2 emissions of around 115,000 tons annually.
Founded in 1965, Ormat Technologies is a geothermal company and the only vertically integrated company engaged in geothermal and recovered energy generation (“REG”), with the objective of becoming a leading global provider of renewable energy. The Company owns, operates, designs manufactures and sells geothermal and REG power plants primarily based on the Ormat Energy Converter – a power generation unit that converts low-, medium- and high-temperature heat into electricity.
The Ormat Recovered Energy Generation (REG) unit is based on Organic Rankin Cycle technology to take waste heat from industrial processes and convert it to power that can be consumed on-site or sold to the grid.
Ormat Technologies CEO Doron Blachar said, “We are excited to announce this strategic acquisition, marking a significant milestone for Ormat as we expand our generating capacity portfolio and expand our footprint in the renewable energy sector. We are confident that this accretive acquisition, which carries approximately an 8x EV/EBITDA multiple (inclusive of the future planned enhancement and optimization but excluding the Cove Fort expansion), will support both our short and long-term growth plans, further leveraging our unique core capabilities to maximize the efficiency and output from these power plants’ energy sources, strengthening our financial position, and delivering meaningful value to our investors.”
