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Message: Geothermal ROI

Geothermal ROI

posted on Jul 27, 2008 10:18AM

Duncan got me thinking about valuation a gain so i did some back-of-the-napkin calculations.

A 40 MW plant is about $150M upfront. It will return about $30M/year in electricity after ongoing expenses for around 30 years. That give an ROI of 20% which is exceptional for most businesses. Assuming a 10 year payoff on the plant, which would consume around $20M per year, the plant would still return $10M per year, or a 6% ROI after expenses for the first ten years, and have a residual value that would probably equal the initial investment.

These numbers look exceptionally good. Can anyone poke some holes here?

Dude59






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