First Geothermal, Now Solar

Oct.19.09 | About: Ormat Technologies, (ORA)

By Ucilia Wang

Ormat Technologies (NYSE:ORA), an established geothermal energy developer, has formed a joint venture with installer Sunday Energy.

The deal represents Ormat's entry into the solar market, the company said. Reno-based Ormat is known for developing geothermal power plants in various parts of the world, including the United States, New Zealand, Guatemala and Kenya. The company also sells equipment for capturing waste heat and turning it into electricity at cement and other industrial sites.

Through its deal with Sunday, Ormat would get a piece of the installation business in Israel. The joint venture plans to build 36 megawatts of solar energy systems, which would cost about $195 million, Ormat said.

The joint venture would own and operate these systems and sell power to the Israel Electric Corp., added Ormat, which would own 70 percent of each project.

Large energy companies are looking for opportunities to get a slice of the solar market as solar energy becomes a more popular source of electricity. General Electric (NYSE:GE), for example, has invested in solar energy equipment companies such as PrimeStar Solar and SolarEdge. Of course, BP and Chevron (NYSE:CVX) have been in the solar business for years.