ORIX ORIX to Begin Construction of 6.5 MW Geothermal Power Plant in Hokkaido

  • Aug 12, 2019
  • Electric Energy

ORIX Corporation ("ORIX") announced today (8/8) that it will begin construction of the Minami-Kayabe Geothermal Power Plant (name to be confirmed) in the Minami-Kayabe region of Hakodate City, Hokkaido. The power plant will have a generation capacity of 6,500 kW (6.5 MW), and will be the largest*1 binary cycle*2 geothermal power plants in Japan.

ORIX was selected to receive subsidies for geothermal power generation in the Minami-Kayabe region from Japan Oil, Gas, and Metals National Corporation (JOGMEC), thanks to the cooperation of local parties; since 2014, ORIX has carried out surveys into geothermal resources and into the possible impact on hot springs and the environment. Now, the company is set to begin construction of a geothermal power plant on municipal land, with the goal of completing construction and commencing commercial operations in early spring, 2022.

Geothermal power generation uses heat from steam and water that has been heated by underground magma to generate electricity. The Minami-Kayabe Geothermal Power Plant will use binary cycle power generation; only the heat of the hot water is used, after which all the water is returned underground. Pumping hot water to the surface reduces both the number of wells that need to be dug and the required site area; at the same time, the design of the power plant emphasizes environmental conservation, such as the use of cooling devices that do not use water to prevent trees from freezing. In addition, in order to safeguard Hokkaido's abundant marine resources, ORIX intends to work together with the local community to protect the environment through afforestation, thinning, and other forest maintenance activities.

Geothermal power generation is capable of providing a stable supply of electricity in the medium and long-term, regardless of the season, weather conditions, or time of day; for this reason, it is hoped that geothermal power can provide baseload power. Japan is thought to have the world's third most abundant geothermal resources behind only the U.S. and Indonesia and accordingly possesses great potential for the development of geothermal power generation.

ORIX is actively engaged in power generation businesses that utilize solar, geothermal, wind, biomass, and other forms of renewable energy. In the field of geothermal power generation, ORIX currently owns and operates one of the largest private geothermal power generation plants in Japan. With a generation capacity of 1,900 kW (1.9 MW), the plant is located on the site of the Beppu Suginoi Hotel (Beppu City, Oita Prefecture), a Japanese-style hot spring inn operated by the ORIX Group. ORIX has been working on developing its geothermal business at multiple locations across Japan; this includes conducting surveys for a publicly tendered geothermal power generation business in Hachijojima, with the goal of commencing operations in 2022.

In 2017, ORIX invested in and commenced a strategic partnership with Ormat Technologies, Inc., a geothermal power generation company listed in the United States. Discussions are underway regarding a geothermal power generation business that fuses the expertise and business foundations of both companies, primarily in Japan and the Asia region. ORIX is also engaged in a wide range of environment and energy businesses, including electric power retailing and the provision of energy-conservation services. Based on its approach of "contributing to the resolution of societal problems through its business activities," going forward ORIX will continue to generate new added value.

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