Ormat Technologies Signs 10-Year PPA With Calpine Energy Solutions for Up to 15MW of Carbon-Free Geothermal Capacity
Ormat Technologies (NYSE: ORA) has signed a 10-year Power Purchase Agreement (PPA) with Calpine Energy Solutions for up to 15 megawatts (MW) of geothermal energy from its Mammoth 2 power plant in California. The agreement, starting in Q1 2027, will replace the existing PPA with Southern California Edison Company.
The new PPA features increased production capacity and higher pricing, reflecting California's tight supply-demand balance for carbon-free electricity. This is driven by state Renewable Portfolio Standards compliance requirements and corporate demand for sustainable energy solutions.
The agreement will support Calpine Energy Solutions' retail portfolio while advancing Ormat's portfolio expansion strategy and long-term revenue generation goals. The energy will be sourced from the Mammoth 2 geothermal facility near Mammoth Lakes, California.
Ormat Technologies (NYSE: ORA) ha firmato un contratto di acquisto di energia (PPA) della durata di 10 anni con Calpine Energy Solutions per un massimo di 15 megawatt (MW) di energia geotermica dal suo impianto Mammoth 2 in California. L’accordo, che avrà inizio nel primo trimestre del 2027, sostituirà il PPA esistente con Southern California Edison Company.
Il nuovo PPA prevede una maggiore capacità di produzione e prezzi più elevati, riflettendo il ristretto equilibrio tra offerta e domanda di elettricità a zero emissioni di carbonio in California. Questo è spinto dai requisiti di conformità agli standard dello stato per il portafoglio rinnovabile e dalla domanda aziendale di soluzioni energetiche sostenibili.
L’accordo sosterrà il portafoglio retail di Calpine Energy Solutions mentre favorirà la strategia di espansione del portafoglio di Ormat e i suoi obiettivi di generazione di ricavi a lungo termine. L'energia sarà prelevata dalla struttura geotermica Mammoth 2 vicino a Mammoth Lakes, California.
Ormat Technologies (NYSE: ORA) ha firmado un acuerdo de compra de energía (PPA) por 10 años con Calpine Energy Solutions para hasta 15 megavatios (MW) de energía geotérmica de su planta de energía Mammoth 2 en California. El acuerdo, que comenzará en el primer trimestre de 2027, reemplazará el PPA existente con Southern California Edison Company.
El nuevo PPA presenta una capacidad de producción aumentada y precios más altos, reflejando el ajustado equilibrio entre la oferta y la demanda de electricidad sin carbono en California. Esto es impulsado por los requisitos de cumplimiento de los estándares de portafolio renovable del estado y la demanda corporativa de soluciones de energía sostenible.
El acuerdo apoyará el portafolio minorista de Calpine Energy Solutions mientras avanza la estrategia de expansión de portafolio de Ormat y sus objetivos de generación de ingresos a largo plazo. La energía se obtendrá de la instalación geotérmica Mammoth 2 cerca de Mammoth Lakes, California.
Ormat Technologies (NYSE: ORA)는 Calpine Energy Solutions와 10년 기간의 전력 구매 계약(PPA)을 체결하였습니다. 이 계약은 캘리포니아의 Mammoth 2 발전소에서 최대 15 메가와트 (MW)의 지열 에너지를 공급받는 내용으로, 2027년 1분기부터 시작되며, Southern California Edison Company와의 기존 PPA를 대체합니다.
이번 새로운 PPA는 생산 용량의 증가와 높은 가격을 특징으로 하며, 이는 캘리포니아의 탄소 없는 전력에 대한 공급과 수요의 긴장된 균형을 반영합니다. 이는 주 정부의 재생 가능 포트폴리오 기준 준수 요구 사항과 지속 가능한 에너지 솔루션에 대한 기업의 수요에 의해 촉발됩니다.
해당 계약은 Calpine Energy Solutions의 소매 포트폴리오를 지원하는 동시에 Ormat의 포트폴리오 확장 전략 및 장기적인 수익 창출 목표를 추진할 것입니다. 에너지는 캘리포니아 Mammoth Lakes 근처의 Mammoth 2 지열 시설에서 공급됩니다.
Ormat Technologies (NYSE: ORA) a signé un contrat d'achat d'électricité (PPA) de 10 ans avec Calpine Energy Solutions pour jusqu'à 15 mégawatts (MW) d'énergie géothermique provenant de sa centrale Mammoth 2 en Californie. Le contrat, qui prendra effet au premier trimestre 2027, remplacera le PPA existant avec Southern California Edison Company.
Le nouveau PPA propose une capacité de production accrue et des prix plus élevés, reflétant l'équilibre serré entre l'offre et la demande d'électricité sans carbone en Californie. Cela est alimenté par les exigences de conformité aux normes de portefeuille renouvelable de l'État et par la demande des entreprises pour des solutions énergétiques durables.
Le contrat soutiendra le portefeuille de vente au détail de Calpine Energy Solutions tout en avançant la stratégie d'expansion de portefeuille d'Ormat et ses objectifs de génération de revenus à long terme. L'énergie sera fournie par l'installation géothermique Mammoth 2, située près de Mammoth Lakes en Californie.
Ormat Technologies (NYSE: ORA) hat einen 10-jährigen Stromabnahmevertrag (PPA) mit Calpine Energy Solutions über bis zu 15 Megawatt (MW) geothermischer Energie aus seinem Kraftwerk Mammoth 2 in Kalifornien unterzeichnet. Der ab dem ersten Quartal 2027 geltende Vertrag ersetzt den bestehenden PPA mit Southern California Edison Company.
Der neue PPA bietet eine erhöhte Produktionskapazität und höhere Preise, die das angespannte Angebot-Nachfrage-Verhältnis für kohlenstofffreie Elektrizität in Kalifornien widerspiegeln. Dies wird durch die Vorgaben zur Einhaltung der staatlichen Anforderungen an das Erneuerbare-Energien-Portfolio und die Unternehmensnachfrage nach nachhaltigen Energielösungen vorangetrieben.
Der Vertrag wird das Einzelhandelsportfolio von Calpine Energy Solutions unterstützen und gleichzeitig die Strategie von Ormat zur Portfoliowachstums und die langfristigen Einnahmeziele vorantreiben. Die Energie wird aus der geothermischen Anlage Mammoth 2 in der Nähe von Mammoth Lakes, Kalifornien, bezogen.
- Secured new 10-year PPA with improved economics and higher pricing
- Increased production capacity up to 15MW compared to previous agreement
- Strategic expansion in California's premium renewable energy market
- New PPA deliveries won't start until Q1 2027
Insights
This new Power Purchase Agreement (PPA) represents a strategic win for Ormat Technologies, marking a significant upgrade from their existing Southern California Edison contract. The deal's improved economics and extended 10-year duration provide enhanced revenue visibility and EBITDA stability through 2037.
The timing is particularly advantageous given California's increasingly stringent renewable portfolio standards and growing corporate demand for carbon-free power. The state's tight supply-demand dynamics for renewable energy are creating favorable pricing conditions for geothermal producers like Ormat, who can offer reliable baseload power - a distinct advantage over intermittent renewables like solar and wind.
From a competitive positioning perspective, this agreement demonstrates Ormat's strong market position in the geothermal space. The company's ability to secure long-term contracts with major energy suppliers like Calpine Energy Solutions validates their operational reliability and helps de-risk their growth strategy. The higher price point achieved in this PPA suggests improving market conditions for geothermal energy and potential upside for future contract renewals across Ormat's portfolio.
The deal's structure, commencing in Q1 2027, allows for optimal planning and potential capacity optimization at the Mammoth 2 facility. This forward-looking approach aligns with Ormat's broader strategy of expanding their electricity segment while maximizing the value of existing assets. The increased production capacity included in the agreement indicates potential operational efficiencies or planned upgrades at the facility.
The 15MW capacity commitment in this PPA highlights the unique value proposition of geothermal energy in California's evolving power infrastructure. Unlike variable renewable sources, geothermal plants provide stable, round-the-clock power output, making them invaluable for grid stability and baseload power requirements.
The Mammoth 2 facility's selection for this agreement is strategically significant. Located in Mammoth Lakes, California, the plant benefits from excellent geothermal resources and established infrastructure. The planned capacity increase suggests potential for operational optimization or possible technological upgrades that could enhance the facility's output and efficiency.
From an infrastructure perspective, this deal reinforces the growing importance of geothermal resources in California's renewable energy mix. As the state pushes toward its ambitious clean energy goals, the reliable nature of geothermal power becomes increasingly valuable for grid stability and energy security. The higher pricing secured in this PPA reflects this strategic importance and could catalyze further investment in geothermal infrastructure development.
New Geothermal PPA Advances Ormat’s Portfolio Expansion Strategy and Long-Term Revenue and EBITDA Generation
RENO, Nev., Jan. 22, 2025 (GLOBE NEWSWIRE) -- Ormat Technologies Inc. (NYSE: ORA), a leading geothermal and renewable energy company, today announced the signing of a 10-year Power Purchase Agreement (PPA) with Calpine Energy Solutions, one of North America’s largest energy suppliers. Under this agreement, Calpine Energy Solutions will purchase up to 15 megawatts (MW) of clean, renewable energy from the Mammoth 2 geothermal power plant located near Mammoth Lakes, California, to support demand within its retail portfolio.
Energy deliveries under the PPA are set to begin in the first quarter of 2027 and will replace the existing PPA with the Southern California Edison Company (SCE). Notably, the new PPA, which includes an increase in production capacity and a higher price point, highlights the tight supply-demand balance of carbon-differentiated electricity in California, driven by state Renewable Portfolio Standards (RPS) compliance needs and voluntary corporate demand.
Sean Fallmer, President, Calpine Energy Solutions explained, “Now more than ever, it’s critical to have a robust network of strategic partners, like Ormat, that focus on alternative and renewable geothermal supply-side technologies that ensure our retail clients can procure customized, scalable energy strategies that are aligned to their unique cost, risk, and carbon goals.”
Doron Blachar, Chief Executive Officer of Ormat Technologies, commented, “We are excited to partner with Calpine Energy Solutions to provide them with reliable zero emission power from our Mammoth 2 geothermal facility. Under this agreement, Ormat will add up to 15MW of geothermal energy to Calpine Energy Solutions, reinforcing their commitment to further supporting their clients in reaching their sustainability goals. Ormat remains on track to meet its long-term targets for generation capacity growth in our Electricity segment. This new PPA with its significantly improved economics, underscores not only the robust growth in renewable power demand but also the market’s trust in our leading geothermal capabilities.”
ABOUT ORMAT TECHNOLOGIES
With over five decades of experience, Ormat Technologies, Inc. is a leading geothermal company, and the only vertically integrated company engaged in geothermal and recovered energy generation (“REG”), with robust plans to accelerate long-term growth in the energy storage market and to establish a leading position in the U.S. energy storage market. 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 Company has engineered, manufactured and constructed power plants, which it currently owns or has installed for utilities and developers worldwide, totaling approximately 3,400MW of gross capacity. Ormat leveraged its core capabilities in the geothermal and REG industries and its global presence to expand the Company’s activity into energy storage services, solar Photovoltaic (PV) and energy storage plus Solar PV. Ormat’s current total generating portfolio is 1,520MW with a 1,230MW geothermal and solar generation portfolio that is spread globally in the U.S., Kenya, Guatemala, Indonesia, Honduras, and Guadeloupe, and a 290MW energy storage portfolio that is located in the U.S.
ABOUT CALPINE ENERGY SOLUTIONS
Calpine Energy Solutions is a CDP-Accredited and ISO 9001:2015 certified retail energy provider, managing a retail energy portfolio spanning all U.S. deregulated electricity markets. Solutions remains one of the United States’ largest retail energy providers for the commercial and industrial space, with a data-driven approach to strategically managing the cost, risk, carbon, and resiliency of corporate energy. Calpine Energy Solutions is a wholly owned subsidiary of Calpine Corporation, America’s largest generator of electricity from natural gas and geothermal resources with operations in competitive power markets. Please visit www.calpinesolutions.com to learn more about how we help businesses transform their energy/carbon management programs from a traditional, transactional approach to a data-driven, sustainable business process.
ORMAT’S SAFE HARBOR STATEMENT
Information provided in this press release may contain statements relating to current expectations, estimates, forecasts and projections about future events that are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that we expect or anticipate will or may occur in the future, including such matters as our projections of annual revenues, expenses and debt service coverage with respect to our debt securities, future capital expenditures, business strategy, competitive strengths, goals, development or operation of generation assets, market and industry developments and the growth of our business and operations, are forward-looking statements. When used in this press release, the words “may”, “will”, “could”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “projects”, “potential”, or “contemplate” or the negative of these terms or other comparable terminology are intended to identify forward-looking statements, although not all forward-looking statements contain such words or expressions. These forward-looking statements generally relate to Ormat's plans, objectives and expectations for future operations and are based upon its management's current estimates and projections of future results or trends. Although we believe that our plans and objectives reflected in or suggested by these forward-looking statements are reasonable, we may not achieve these plans or objectives. Actual future results may differ materially from those projected as a result of certain risks and uncertainties and other risks described under "Risk Factors" as described in Ormat’s annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 23, 2024, and in Ormat’s subsequent quarterly reports on Form 10-Q that are filed from time to time with the SEC.
These forward-looking statements are made only as of the date hereof, and, except as legally required, we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
| Ormat Technologies Contact: Smadar Lavi VP Head of IR and ESG Planning & Reporting 775-356-9029 (ext. 65726) slavi@ormat.com | Investor Relations Agency Contact: Joseph Caminiti or Josh Carroll Alpha IR Group 312-445-2870 ORA@alpha-ir.com |
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