Provo company able to tap geothermal power quickly

Geothermal companies are relatively small players in the energy market and have had to scramble to lock up financing, particularly during a recession.

Merrill Lynch & Co. has pledged to fund Raser's first 100 megawatts of projects and says it is staying in the game.

"We've done a lot with Raser," said Merrill Lynch spokeswoman Danielle Robinson. "We're very committed to the company."

Cook said his company can raise additional money from joint ventures and stock sales. "This is where the money flows, to alternative energy projects that pencil out," he said. The company made its first major stock sale Nov. 14 to Fletcher Asset Management of New York.

"We are enthusiastic about our investment," said Kell Benson, Fletcher's vice chairman. The firm bought $10 million in stock at $5 a share, with an option to double the stake.

Raser and its supplier, UTC Power, plan to build another seven geothermal energy plants across the western United States by the end of 2009 and 10 plants a year for the next decade.

The push for geothermal power has been accelerated by state mandates like those in California, which this month said utilities must obtain a third of their electricity from renewable sources by 2020.

Raser, which specializes in low-boil geothermal sites, started buying leases five years ago on hundreds of thousands of acres that had been passed over because of their lower heat potential.

New technology, however, has made low-boil water useable for geothermal power. Raser buys 250-kilowatt power units from UTC Power, a subsidiary of United Technologies Corp.

Geothermal is also being used on a smaller scale.

"These things are slot machines. They make money," said Bernie Karl, owner of Chena Hot Springs Resort, off the grid 60 miles northeast of Fairbanks, Alaska. On geothermal energy from early UTC prototypes, Karl powers light bulbs, heats lodges and rooms for 210 guests, warms a greenhouse that grows food and spices, keeps an ice house frozen and makes hydrogen for resort vehicles.

Raser hit hot water at a few thousand feet below the surface circulating inside a zone of porous limestone a mile deep. The underground "lake" cycles hot water endlessly under the power of the Earth's internal heat like a steam engine, throwing up loops of hot water intersected by wells that return it to the system.

The company holds rights to 78 square miles of land in the area and believes it has barely tapped the full potential.