Enhanced geothermal attracting $$$ in North America

Scandinavian financial services and investment giant Glitnir opened its New York office today, which will be headquarters to its U.S. subsidiary Glitnir Capital Corp.

Why the heck is this significant or worthy of a post? Part of the reason Glitnir is setting up shop in the United States is because of what it considers “America’s huge geothermal energy potential.” And it’s all baseload, baby.

The way this Icelandic investor sees it, the U.S. has the potential for a six-fold increase in its installed geothermal capacity, which would double existing global capacity. “Glitnir estimates that investments of $9.5 billion (U.S.) are required in projects currently under development, and that further $29.9 billion are needed between now and 2025 to develop and harness future resources,” according to a company release. Obviously, Glitnir wants to apply its experiences from Norway and Iceland (an established geothermal superpower, you could say) and neighbouring countries to opportunities in the United States, and is prepared to inject a large part of the necessary capital. “Some smaller companies are lacking financial muscle to fully develop projects with potential to be profitable. Therefore, Glitnir expects considerable consolidation in the industry over the next few years.”

According to a report from Dow Jones: “The firm is readying a formal announcement of a financing deal of more than $10 million behind Iceland America Energy Inc., a geothermal specialist with a deal to provide energy to PG&E through the Truckhaven project in California… Other recent deals include a $19 million financing of Western GeoPower Corp. (of Vancouver), a $23 million financing round for ThermaSource in Santa Rosa, Calif., and a $20 million debt round to help Nevada Geothermal Power Inc. conduct drilling operations.”

Reuters reports that Glitnir plans to spend $1 billion on U.S. geothermal energy projects over the next five years, what it considers to be about 10 per cent of a market that it brands the “sleeping beauty of sustainable energy.”

In a different press release, the company seems to expand its interest to the larger North American market — i.e. Canada as well. “We see a considerable geothermal energy potential in 82 countries worldwide — including the USA and Canada,” said Arni Magnusson, managing director of Glitnir Global Sustainable Energy. I’ve since e-mailed the company to get clarification on its position regarding Canada. Perhaps it has its eye on oil sands opportunities. Perhaps more… will be interesting to get some insight on this. I’ll keep you all posted.

The bottom line is that it’s exciting to see some major money flowing to this area, backed by experience and know-how (keep in mind we’re also seeing folks like Khosla investing in this area). Geothermal promises to be an important slice — along with solar PV, solar thermal, wave energy, wind and hydroelectric — of the overall clean energy needs of the continent.

REGEN Energy: using “swarm logic” to manage energy use

My Clean Break column today takes a look at a Toronto-based company called REGEN Energy, which has developed wireless controllers that attach to various appliances in a building that cycle on and off. The controllers communicate with each other and organized themselves so that none of the appliances cycle on at the same time. Their goal is to smooth out their peak energy consumption, saving the building owner from paying peak pricing and helping maximize the efficiency of the grid. The beauty with these devices is that you don’t need to centrally control them. They’re designed as an emergent system, using what’s often referred to as swarm logic to self-organized and co-ordinate their actions to solve problems — kind of the ways bees and ants do it in nature. The company is so confident that its technology can reduce building energy bills that they’ve chosen a rental model as their main stream of revenue. Potential customers are guaranteed an immediate payback by saving more money on their monthly bill than the rental charge of the controllers. Not a bad deal.

REGEN Energy: using “swarm logic” to manage energy use

My Clean Break column today takes a look at a Toronto-based company called REGEN Energy, which has developed wireless controllers that attach to various appliances in a building that cycle on and off. The controllers communicate with each other and organized themselves so that none of the appliances cycle on at the same time. Their goal is to smooth out their peak energy consumption, saving the building owner from paying peak pricing and helping maximize the efficiency of the grid. The beauty with these devices is that you don’t need to centrally control them. They’re designed as an emergent system, using what’s often referred to as swarm logic to self-organized and co-ordinate their actions to solve problems — kind of the ways bees and ants do it in nature. The company is so confident that its technology can reduce building energy bills that they’ve chosen a rental model as their main stream of revenue. Potential customers are guaranteed an immediate payback by saving more money on their monthly bill than the rental charge of the controllers. Not a bad deal.

From hydrogen to blimp-like wind generators

Pierre Rivard, chairman and former CEO of Canadian fuel-cell developer Hydrogenics Corp., has decided after many years as a champion of the hydrogen economy to focus his professional attention on an emerging wind technology with the potential to help developing nations. Rivard announced this week he was leaving Mississauga-based Hydrogenics, which next to Ballard Power is the highest-profile fuel-cell developer in Canada (and among the tops in the world), to become president and CEO of Ottawa-based Magenn Power, which I profiled back in December 2005 (unfortunately the Toronto Star link has expired).

I have to admit, at the time I wasn’t so sure about Magenn’s product, which is a wind generator that floats like a rotating blimp that’s tethered to the ground. It’s a novel and intriguing concept, based on the ideas of Magenn founder Fred Ferguson, who spent half his life studying and advancing the design of Hindenburg-like airships. Ferguson hired former Ottawa-area high tech guru Mac Brown who was then trying to raise $2 million to develop a prototype. This would form the basis for a range of systems from 1 kilowatt to 1.6 megawatts in nameplate power capacity. The goal was to have the first product available by the second half of 2006. That time came and went and, well, I kind of thought Magenn was limited to being a curiosity up against a barrage of skeptics and unable to raise enough capital.

Hiring Rivard, who you’ve got to think did his due diligence, brings credibility to the company and much-needed respect — what it will need to bring in capital. Brown is still around, but he’s now chief marketing officer and interim COO.

I had a chance this week to chat with Rivard about the move and his reasons for giving up hydrogen and fuel cells to pursue wind technology. He said Magenn first approached Hydrogenics to inquire about using hydrogen to lift its larger blimps, since hydrogen is cheaper than helium. The more he learned about Magenn and what it was trying to do the more interested he became, particularly at the idea of mass-manufacturing airships and bringing electricity to unserved areas of the world. Here are some select bits from the interview:

Why Magenn? “It’s a really interesting opportunity. It has a lot of potential for rural electrification and developing countries. This technology would allow the use of renewable energy around the clock regardless of siting. You have the opportunity here to electrify 2.1 billion people without electricity. If you have electricity at the village level, you can have vaccinations, refrigeration, water pumps driving water out of wells, an Internet connection, cellular power sites — you can link it up to these $100 laptops that children could find in these developing regions of the world. All that’s missing is electricity.”

What’s your priority in the new job? “Right now there’s no capital in the company to speak of, but one of my key goals is to accelerate the company by attracting capital.” (He goes on to say the company got a $950,000 grant from Sustainable Development Technology Canada and plans to link up with industrial customers, partners and perhaps a university or two for that project).

Why leave Hydrogenics? “It’s been 12 years, and I’ve pretty well made my mark. I’ve averaged over the course of my lifetime 12 to 15 years per job. This new job is potentially the last one I will hold before I retire, but it’s aligned with my clean energy interests and what I’ve been doing for most of my life.”

I’ll have to put Magenn back on my radar screen, but I still won’t be convinced until I’ve seen one of these blimps working. Major challenges ahead, but Rivard is no stranger to challenges given his years at Hydrogenics, which like most of its peers has struggled to overcome skepticism about the future of hydrogen and PEM fuel cells.