Petratherm, a clean energy company seeking to produce power from underground heat, is to apply for $5 million of the increased funds the federal government devoted to renewable energy in the budget.
”It’s important that the geothermal industry has another source of funding because the equity markets are quite challenging at the moment,” said Terry Kallis, managing director of Adelaide-based Petratherm.
The government boosted grants for ”emerging” geothermal, wave, wind and solar technologies to $100 million from $40 million, and committed $100 million to a renewable energy venture capital fund.
Australia, the world’s biggest coal exporter, has set a target of generating 20 per cent of its power from renewable energy by 2020.
The Prime Minister, Julia Gillard, wants to set a price on carbon emissions in July 2012 before a trading system that may begin as early as 2015, seeking to curb greenhouse gas pollution and encourage investment in cleaner energy.
Uncertainty about whether the government will impose a carbon price has discouraged investors, hurting shares of geothermal companies such as Petratherm, which has dropped 38 percent in the past 12 months, Mr Kallis said yesterday.
Petratherm shares rose 4.6 per cent yesterday to 11.5¢, against a 1.8 per cent drop in the S&P/ASX 200 Index.
Geodynamics, another domestic geothermal company, fell 5.4 per cent to 26.5¢.
Petratherm is targeting the government funds for its Heliotherm project, which aims to combine geothermal, solar and natural gas technologies to produce power, Mr Kallis said.
Geodynamics intends to spend as much as $70 million in the next 12 months as it moves towards a target of starting a 1-megawatt pilot project by March 2012.
If successful, the Cooper Basin venture could lead to a 25MW plant using technology that injects water underground into hot rocks to generate steam for making electricity.
India’s Tata Power Company owns about 8.7 per cent of Geodynamics, while Origin Energy holds about 5.9 per cent.
