Casey Hinson
Houston, TX (USA)
Role(s):
Founder/Owner/Principal
Hygienic Energy, LLC
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Startup
Location:
Houston
Industry:
Energy
Year Founded:
2008
Number Employees:
1-10 people
Description:
Hygienic Energy, LLC. is a new renewable energy company with a strong management team, as well as a strong team of advisors and board members. We intend to build a 30 megawatt geothermal power plant in the great state of Nevada. This geothermal power plant will provide clean, environmentally friendly energy to over 30,000 households in the surrounding areas. Geothermal electricity is produced from the natural heat energy from below the earth's surface. This is a clean, renewable energy source with virtually zero emissions. Because the energy comes from the heat of the earth, there is no fuel requirements for producing this electricity. This results in extremely efficient and low cost operations.
After the plant is completed, we expect to have a Power Purchase Agreement in place, resulting in an immediate sale of electricity into the main grid. First year revenues will be approximately 15 million dollars. We expect that number to increase at a rate of 3% - 5% per year based on increases in market-wide wholesale electricity costs.
With a long term Power Purchase Agreements (PPA), we will have a set amount of kilowatt-hours to supply to the grid every month. The price paid per kWh will be the market spot price on a day-to-day basis. We will also be able to hedge these prices by trading power on the futures market. We estimate an average wholesale power sales price of about 5 cents per kWh.
The government is giving a production tax credit of 2 cents per kWh. This credit will last for 10 years from the start date of the plant. The tax credit is currently available for plants that are on-line by December 31, 2010. Based on the successful efforts of lawmakers to move this date up in the past, we expect for this date to be moved out further into the future to accommodate our project. (We do not need this tax credit in order to be profitable).
Because we are a renewable energy base load plant, we will receive "green tags" or renewable energy credits from the government. These renewable energy credits can be sold for $5/MWH to other traditional power producers.