MANAGUA – After some moments of tense uncertainty in the early months of President Daniel Ortega’s 2007 return to the presidency, Polaris Geothermal has sorted out its problems with the government and is now moving forward – and, more literally, downwards – toward expanding its power output as the country’s fastest-growing renewable energy source.
The Canadian geothermal plant, which is currently producing 10 megawatts of energy on the skirts of León’s Santa Clara Volcano, is drilling a series of new production and reinjection wells to increase its power output to 34 megawatts by the end of 2009. Then it’s straight on to phase III, which is scheduled to boost its output to 72 megawatts by the beginning of 2010, making it the largest geothermal energy provider in Central America, capable of powering 124,000 homes – the population of León.
Finally, by the end of 2012, the plant hopes to be producing at full capacity of 200 megawatts, or roughly 40 percent of the country’s current energy demand.
If all goes according to plan, Polaris hopes to lead the way in helping Nicaragua to kick its dependency on foreign oil and live up to its promise as a major producer of geothermal energy.
“Nicaragua has the potential to produce more than 2,000 megawatts of geothermal energy,” says Polaris president and CEO Tom Ogryzlo, pointing to the ridge of volcanoes along the country’s Pacific coast. “Nicaragua could be an exporter of energy to the rest of Central America.”
Yet despite the country’s subterranean power potential, Nicaragua currently has only two geothermal sites, Polaris and an Israeli-owned Momotombo plant, which produces 35-megawatts of energy and has run into problems with the government after the Environmental Ministry discovered it was dumping waste in to Lake Managua.
Exploration has recently started on a third geothermal concession outside of León, which is thought to have upwards of 400 megawatts of untapped power potential.
Geothermal energy is produced by drilling wells up to 2 kilometers deep in the porous rock surrounding volcanoes. The steam from the wells is passed through units that separate the liquid brine (salt water) from the dry steam, which then passes through turbines that convert that steam into energy. The brine, in the case of Polaris, is then redeposited into the ground, so as not to upset the natural balance of the site.
Underground magma produces a constant source of heat, which then converts the redeposited brine solution back into steam, completing the sustainable cycle.
“Our environmental footprint is as small as you can get,” Ogryzlo said.
In addition, Polaris has recently signed a deal with an Icelandic company to install a new state-of-the-art plant that will recycle the re-injected brine into an additional 22 megawatts of energy, making the plant even more efficient and a model in the hemisphere, Ogryzlo said.
“That will make one hell of a big difference,” Ogryzlo said of the new equipment, which arrived here on a ship last month.
Though Polaris had some unsettling moments last year, the company insists that its troubles are now in the past and the government is now fully on board.
To document its support for Polaris, the Energy and Mines Ministry on May 12, 2007, signed an agreement with the geothermal company to support its plans to increase energy production. The first point in the memorandum of agreement between the government and Polaris reads, “The capacity for generation of geothermal energy must be increased for the purpose of reducing dependency on generation based on petroleum, thus contributing to fulfill the demand for electricity that the industrial and commercial sectors require.”
A year later, Ogryzlo says the government has kept its word by supporting Polaris and keeping in constant communication.
“There was no consistency before, but now we have complete consistency and we know where we stand,” Ogrzylo said, referring to the improved relations with the Sandinista government.
Ogrzylo thinks the severity of the energy crisis has actually led the government to better understand the situation and recognize the importance of renewable energy projects, such as Polaris.
Plus, the company CEO notes, support for renewable energy is one of the very few issues on which all political parties can agree in an otherwise gridlocked government.
“We can do business with this government,” Ogryzlo says.