BOISE, IDAHO--(Marketwire - Aug. 19, 2011) - U.S. Geothermal Inc. (News - Market indicators)(NYSE Amex:HTM) –

A former stagecoach stop where travelers lingered in the hot water of remote eastern Oregon is being transformed into Oregon's first commercial scale geothermal power plant through a collaboration of U.S. Geothermal Inc., the federal government, equity partner Enbridge Inc. and local governments.

Renewable energy supporters and others received a briefing on the $130-million Neal Hot Springs project today from Sen. Ron Wyden; Steve Spinner, former Chief Strategic Operations Officer, Loan Programs, Department of Energy; U.S. Geothermal chief executive Daniel Kunz; Enbridge Inc. executive John K. Whelen; and Renewable Northwest Project executive director Rachel Shimshak.

"The people of Oregon, led by our citizens in Malheur County, have again exhibited their leadership in renewable energy with the exciting development of U.S. Geothermal's Neal Hot Springs project," Sen. Wyden said. "The Department of Energy is to be thanked and congratulated for its decision to help fund this zero-emission contributor to the Pacific Northwest energy grid."

The primary source of capital for development of the Neal Hot Springs project has been funded through a $96.8-million low-interest loan guarantee through the U.S. Department of Energy's Loan Programs Office.

"The loan guarantee for the Neal Hot Springs project increases the already important role that geothermal power plays in helping our nation increase its clean, renewable energy," said Jonathan Silver, executive director of the Department of Energy's Loan Programs Office. "The project introduces a first-of-a-kind technology that could expand geothermal resources in other areas of the country and brings green jobs to the area. It's an important renewable energy development in the Pacific Northwest that we are proud to support."

Kunz said the 25-megawatt power plant near Vale, scheduled for completion late in 2012, will be Boise, Idaho-based U.S. Geothermal's largest power plant yet in its approximately 10-year history. He said investigation into the extent of the resource will be completed to determine whether there is the potential to expand power production at the site.

"It is also important that the U.S. Government continue its investment tax credits for Neal Hot Springs and other geothermal energy development projects to serve as a catalyst for additional investment and help reduce the country's reliance on fossil-fuel power," Kunz said. "We believe Neal Hot Springs can be a productive source of clean, green energy from the earth's crust and of good jobs for generations to come."

Senator Jeff Merkley of Oregon expressed his continuing support for programs that enable the U.S. economy to benefit from the tremendous energy resource lying deep within the Earth's crust.

"Every day we send a billion dollars overseas to countries that often don't share our values to pay for our dependence on foreign oil. We should instead be spending that money here in America, creating red, white and blue, clean energy jobs," said U.S. Senator Jeff Merkley. "This geothermal project is a prime example of homegrown American energy that will create jobs here in Oregon."

Idaho Senator Mike Crapo said, "Developing our nation's energy resources is a critical step to put Americans back to work and allow our nation to become more energy independent. I have worked with my Senate colleagues to sponsor three bills that promote and expand the use of geothermal energy and I am proud that an Idaho-based company, U.S. Geothermal, and resources from Northwest states, including Idaho, are leading the way in the advancement of geothermal energy in the U.S."

Renewable Northwest Project executive director Rachel Shimshak said the Neal Hot Springs development is a major milestone for clean energy in the region, which was an early pioneer in renewable energy with New Deal era hydropower projects developed in the Columbia River basin. Renewable Northwest Project is a non-profit advocacy group that promotes the responsible development of new renewable energy resources – such as geothermal, wind and solar – to diversify the resource mix while displacing polluting fuels.

"The Northwest region has a long history of tapping our abundance of renewable energy resources, and the Neal Hot Springs project is an exciting new example of vision and smart clean energy investment," Shimshak said. "We applaud U.S. Geothermal for this significant milestone, marking a major step in our region's forward push toward a clean energy future. Our communities, environment and local economies will equally benefit."

Neal Hot Springs is the first geothermal project to be offered a conditional commitment for a loan guarantee under DOE's Title XVII loan guarantee program, which was created by the Energy Policy Act of 2005 to support the deployment of commercial technologies along with innovative technologies that avoid, reduce, or sequester greenhouse gas emissions. The DOE loan guarantee will guarantee a loan from the U.S. Treasury's Federal Financing Bank. The $96.8-million Federal Financing Bank loan represents 75% of total project cost. When combined with the previously announced equity investment by Enbridge Inc., the loan provides 100 percent of the capital remaining to fully construct the project.

"At Enbridge, we believe our green energy investments are not only good for the environment, they are clearly good for our business, offering attractive returns and providing a new source of earnings growth that complements our petroleum liquids and natural gas transportation businesses," said John K. Whelen, Senior Vice President & Controller, Enbridge Inc.

The Neal Hot Springs project is creating high-quality American manufacturing and construction jobs through the construction of the power plant, which is being supplied by Houston-based TAS Energy, Inc., a provider of high efficiency modular energy systems. U.S. Geothermal anticipates about 95 percent of the power plant's infrastructure and parts will be supplied by U.S.-based manufacturers. Approximately 150 construction jobs and over a dozen permanent jobs are expected to be created during the project's 18-month construction phase.

About U.S. Geothermal Inc.:

U.S. Geothermal Inc. is a leading renewable energy development company that is operating geothermal power projects at Raft River, Idaho and San Emidio, Nevada. The Neal Hot Springs project will be the Company's third operating power project. The Company holds geothermal energy rights to 69,500 acres comprising six advanced stage geothermal development projects. The San Emidio project is currently undergoing construction of a new 8.6 net MW binary cycle power plant.

The information provided in this news release may contain forward-looking statements within the definition of the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995, including statements regarding the anticipated development of the Neal Hot Springs project, including financing, megawatt output and schedule. These statements are based on U.S. Geothermal Inc.'s current expectations and beliefs and are subject to a number of risks and uncertainties that can cause actual results to differ materially from those described, including but not limited to, completion of the resource drilling at Neal Hot Springs. Readers are cautioned to review the risk factors identified by the Company in its filings with Canadian and US securities agencies. Forward-looking statements are based on management's expectations, beliefs and opinions on the date the statements are made. U.S. Geothermal Inc. assumes no obligation to update forward-looking statements if management's expectations, beliefs, or opinions, or other factors, should change.