U.S. Geothermal Inc. signed a power purchase agreement between its USG Nevada LLC unit and NV Energy (NYSE: NVE) for the purchase of an annual average of up to 19.9 MW from the San Emidio Geothermal Project in Nevada.

USG Nevada LLC said it is investigating remedies for constraints related to transmission that may limit the project's total output to 16 MW.

The 25-year PPA anticipates the development of two electric power generation units at San Emidio. The Unit 1 power generation plant, scheduled to enter service during the 4th quarter of 2011, is under construction and will replace an existing 3.6 MW plant. Subject to successful production well development, the Unit 2 power generation plant is scheduled to be on line during the 2nd quarter of 2013. Two additional Units 3 and 4 are also planned at San Emidio after sufficient drilling has been completed to define additional reservoir production capacity.

The PPA is subject to approval by the Public Utilities Commission of Nevada and is expected to be submitted to the PUCN by NV Energy within 100 days.

Read more news and features on renewable energy.