Geothermal energy in Iceland

Alterra Power Corp. CA:AXY -11.67% ("Alterra") is pleased to announce that an operating permit has been received for its planned 80 MW expansion of the Reykjanes geothermal power plant in Iceland. The permit formally allows Alterra to install and place into service a new, currently-owned 50 MW turbine, as well as a 30 MW low pressure turbine that will be powered from existing steam production.

Separately, Alterra is continuing its effort to finalize power purchase arrangements with aluminum smelter Norðurál Helguvík sf. (a subsidiary of Century Aluminum Co., "Norðurál") and other industrial power purchasers. Results from a pending arbitration related to a prior power purchase agreement with Norðurál are expected this fall.

Júlíus Jónsson, CEO of Alterra’s Icelandic subsidiary, HS Orka hf ("HS Orka"), said, "I am pleased that we have now been granted regulatory approval to move forward with this major expansion in a uniquely rich resource area. Full attention is now focused on finalizing our power purchase and financing arrangements, which we intend to achieve in the next few months."

HS Orka is the largest privately owned energy company in Iceland, producing 9% of the country’s power needs and 10% of the country’s heating needs. Installed geothermal power capacity is 175 MW from the Svartsengi and Reykjanes power plants. In addition, HS Orka generates 150 MW of thermal energy for district heating. Expansions are planned that could increase HS Orka’s geothermal power production to 405 MW by 2016. HS Orka is 75% owned by Alterra, and 25% by Jarðvarmi slhf, a company owned by a group of 14 Icelandic pension funds.

Alterra Power Corp is a leading global renewable energy company, formed in 2011 through the merger of Magma Energy Corp and Plutonic Power Corp. We operate six power plants totaling 571 MW of capacity, including two geothermal energy facilities in Iceland, a geothermal power plant in Nevada, British Columbia’s largest run of river hydro facilities and the province’s largest wind farm. Our 315 MW share of production generates 1,518 GWh of clean power annually. We have an extensive portfolio of exploration and development projects, a skilled international team of explorers, builders and operators as well as the strong financial capacity to support our aggressive growth plans.