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Unlocking Geothermal Power Eastern Caribbean Powerhouse

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Unlocking Geothermal Power Eastern Caribbean Powerhouse ( unlocking-geothermal-power-eastern-caribbean-powerhouse )

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FIGURE 14.4 Planned Structure of the Geothermal Project Tetra Tech Alta Rock 100 percent ownership Nevis Energy Limited Nevis Island Administration Concession Agreement to do production drilling, desing, build, operate and finance NREI Debt PPA NEVLEC Customers Sources: Nevis Pages. “Nevis Island Administration and Nevis Renewable Energy International, Inc. Sign Geothermal Concession Agreement.” 3 September 2014. http://www.nevispages.com/nevis-island-administra- tion-nia-and-nevis-renewable-energy-international-inc-nrei-sign-geothermal-concession-agreement/. (accessed on 12 November 2014); ThinkGeoenergy. “Nevis Choosing American Consortium for Geothermal Project.” 21 November 2013. http://thinkgeoenergy.com/archives/17213 (accessed on 12 November 2014). Two agreements have been signed to date: the concession agreement and a PPA. The concession agreement is to explore and exploit the geothermal resource and finance, build, and operate the power plant. Nevis International is a US consortium of private individuals and private firms established with support from the US State Department.368 The private firms include two US-based firms (Tetra Tech and Alta Rock) and a Nevis-based firm (Nevis Energy Limited).369 NEVLEC is the project off-taker and would purchase all the electricity generated by the project under the PPA contract. Nevis International has not published its cost estimates for the project, and cost estimates from other sources vary. Preliminary estimates suggest that developing a 10 MW geothermal power plant in Nevis could cost about US$80 million.370 These estimates include exploration and production drilling and power plant construction costs. The construction of transmission lines and access roads would increase the total cost to about US$96 million. On the other hand, West Japan Engineering Consultants, Inc. estimated the average cost of building a 20 MW power plant, not including production drilling, to be about US$40 million. Their cost estimate increases to approximately US$125 million when the costs for production drilling, physical contingencies, consultant fees, and administrative expenses are included. 368. “Nevis Not Giving Up on Geothermal,” ThinkGeoenergy, May 22, 2015, accessed December 8, 2015, http://www.thinkgeoenergy.com/ nevis-not-giving-up-on-geothermal/. 369. “Nevis Choosing American Consortium for Geothermal Project,” ThinkGeoEnergy, November 21, 2013, accessed November 12, 2014, http://www.thinkgeoenergy.com/nevis-choosing-american-consortium-for-geothermal-project/. 370. Financial model that accompanies this report, based on information from: Magnus Gehringer and Victor Loksha, Geothermal Handbook: Planning and Financing Power Generation (Washington, DC: The International Bank for Reconstruction and Development, Technical Report 002/12, June 2012), accessed October 22, 2014, http://www.esmap.org/sites/esmap.org/files/DocumentLibrary/ FINAL_Geothermal%20Handbook_TR002-12_Reduced.pdf; IDB, “Sustainable Energy Facility (SEF) for the Eastern Caribbean: Loan Proposal RG-L1071, RG-G1009, and RG-G1004” (2015), accessed December 2, 2015, http://www.iadb.org/en/projects/project- description-title,1303.html?id=RG-L1071. 153

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