Presentation 3.29.11

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Formerly the Spa at Pagosa Springs In business since 1950 Presents Pagosa Springs Geothermal Waters Opportunities and Responsibilities 1 Geothermal Stakeholder Association

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Welcome Kathy Keyes Introduction Angel Preuit-Stahr Presentations by James E. Denney Ken Vickerstaff 2 Geothermal Stakeholder Association

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Presents: Pagosa Springs Geothermal Waters Opportunities and Responsibilities Introduction A. Thank you for coming B. Our Expansion Plans C. The Source of mineral waters 1. shared with everyone 2. not just well owners D. More uses every year E. Uses = economic opportunities for 1. ONE person/business 2. OR, for everyone a. Public/Private Groups, b. businesses , and c. individuals 3 Geothermal Stakeholder Association

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Introduction (continued) F . Today, we want you to understand 1. Benefits to you 2. Protection of the Source 3. Maximizing use of the Source G. James Denney, presenter 1. Our business planner, 2. with 15 years SBDC experience in a. business planning, b. loan packaging, and c. grant writing 3. and, over 30 years teaching p-t a. High School, b. Junior College and c. College levels H. Ken Vikerstaff , presenter 1. 33 years experience in Natural and organic packaged goods industry 2. many national brands including Silk, Yoplait, Just Desserts 3. active supporter of the Geothermal Greenhouse Partnership and this project. 4 Geothermal Stakeholder Association

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Geothermal Stakeholder Association 5 Presentation I. Historical usage A. Health & Tourism B. Community comfort 1. melting snow & ice, 2. heating 27 buildings Gratitude #2 Pagosa Springs’ Natural Resource Gratitude #1

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Geothermal Stakeholder Association 6 II. More & more opportunities A . Two of many reports 1. Study for Geothermal Greenhouse Project (GGP) Oct2010 2. 2006 NREL Geothermal – The Energy Under Our Feet Gratitude #3 Observations and Recommendations Regarding Geothermal Use in Pagosa Springs, Colorado Prepared by: John Lund National Renewable Energy Laboratory Gerald Huttrer Geothermal Management Company, Inc.

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Geothermal Stakeholder Association 7 B. What Opportunities? 1 . FROM old uses 2.TO expanded uses a. new industries b. new community services c. new source of revenue

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Geothermal Stakeholder Association 8 B. What Opportunities? 1. FROM old uses 2.TO expanded uses From: Colorado Geological Survey a. new industries b. new community services c. new source of revenue Pagosa Colorado Springs Industry - Commercial size Sites Sites 1 Spas and Pools 18 3 2 Space Heating - Agencies 15 1 Building Heating 27 Snow & Ice Melting several 3 Greenhouses 4 0 4 Food Processing 0 0 Mushroom Culture Fruit & Veg Drying 5 Aquaculture (Fish farms) 1 0 6 District Heating 1 0 7 Electric Generation 0 0 8 Geothermal Housing 0 0 9 Education 0 0 Possible with water temperature at Pagosa Springs.

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Geothermal Stakeholder Association 9 B. What Opportunities? 1. FROM old uses 2.TO expanded uses a. new industries b. new community services c. new source of revenue

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Geothermal Stakeholder Association 10 B. What Opportunities? 1. FROM old uses 2.TO expanded uses a. new industries b. new community services c. new source of revenue

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Geothermal Stakeholder Association 11 C. Who benefits? Everyone. 1. Individuals 2. Businesses a . expansion projects b. new industries 3 . Communities - a. less utility costs b. additional services 4 . Many generations Pagosa Colorado Springs Industry - Commercial size Sites Sites 1 Spas and Pools 18 3 2 Space Heating - Agencies 15 1 Building Heating 27 Snow & Ice Melting several 3 Greenhouses 4 0 4 Food Processing 0 0 Mushroom Culture Fruit & Veg Drying 5 Aquaculture (Fish farms) 1 0 6 District Heating 1 0 7 Electric Generation 0 0 8 Geothermal Housing 0 0 9 Education 0 0 Possible with water temperature at Pagosa Springs.

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Geothermal Stakeholder Association 12 C. Who benefits? Everyone. 1. Individuals 2. Businesses a. expansion projects b. new industries 3. Communities - a. less utility costs b. additional services 4. Many generations http://rechargecolorado.com/index.php/success_stories/small_hydro_project_saves_for_ouray_taxpayers Recharge Colorado.com Small hydro project saves $$ for Ouray taxpayers “…The city expects to save $24,000 a year in electricity, recouping its initial investment in less than a year .”

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Geothermal Stakeholder Association 13 C. Who benefits? Everyone. 1. Individuals 2. Businesses a. expansion projects b. new industries 3. Communities - a. less utility costs b. additional services GGP Fresh veggies year around Training opportunities Tourist Attractions 4. Many generations

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Geothermal Stakeholder Association 14 III. Why Wait? A. Scientists' warning - Study the Source ! (picture: Cross Section of our Geological Formations) 1. Test current usage and capacity to expand by a. meter installations for b. volume and temperature data collection 2. Utilize reinjection wells to test the extent of the Source - we may have more capacity than expected Gratitude #4

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Geothermal Stakeholder Association 15 From 2010 NREL report: Observations and Recommendations Regarding Geothermal Use in Pagosa Springs, Colorado by Lund and Huttrer Oct 2010 “At this time, with the available data, it is not possible to accurately quantify either the volume of the geothermal reservoir… “ “The use of a production well and an injection well together minimizes the impact on the geothermal resource .” Conclusions and Recommendations: 5) In order to obtain resource-use information and to protect existing thermal water users, pressure, temperature, and flow-rate measurements should be made … 6 ) The resource should be further evaluated by producing and reinjecting thermal fluids for 72-96 hours. … B. Why the Study is important 1. Protect the Source 2. Protect all users 3. Performed by 3rd party, without financial biases 4. Study provides: a. 'Bankable' reports needed by everyone b. Qualitative deliverables of the Source GOAL: Confirm or deny Resource greater than expected c. Confidentiality for individual users d. Multiple reports starting in 90 to 120 days

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Geothermal Stakeholder Association 16 How do we use Bankable Reports? First, a definition of Bankable Reports: An unbiased, 3 rd party, scientific report that quantifies the Source and its potential life based on current and potential usage. A. C alculate profitability B. Calculate ROI C. Apply for funding D. Level the playing field E. Creates a knowledgeable community V. The Business Perspective by Ken Vickerstaff Gratitude #5

Commercial Geo-Thermal Opportunities:

Commercial Geo-Thermal Opportunities

Organic Fresh Culinary Herbs:

Organic Fresh Culinary Herbs Shenandoah Living Herbs invested $3 million in a 7 acre greenhouse project which resulted in 32 new jobs.

Sustainable Geo-Fish:

Sustainable Geo-Fish There is a million pound striped bass market gap at $4 per pound that exists for Whole Foods and a Geo-Thermal Marine Steward Council certification.

Packaged Organic Fresh Produce:

Packaged Organic Fresh Produce 2010 sales of Organic Packaged Produce in Natural/Organic Stores were $161,220,813 up 26%. The 4 th largest category in the industry. Grocery Sales of Organic Packaged Produce were $1,192,998,818 up 16%

U.N.F.I. supplies the Natural/Organic Food Industry:

U.N.F.I. supplies the Natural/Organic Food Industry UNFI has a truck a day running through Pagosa Springs on Highway 160 and have agreed to review any of our Geo-Thermal branded products as a primary distributor.

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Geothermal Stakeholder Association 23 VI. Examples of Economic Growth A. Industries Chart B. The ultimate Pagosa Colorado Springs Industry - Commercial size Sites Sites 1 Spas and Pools 18 3 2 Space Heating - Agencies 15 1 Building Heating 27 Snow & Ice Melting several 3 Greenhouses 4 0 4 Food Processing 0 0 Mushroom Culture Fruit & Veg Drying 5 Aquaculture (Fish farms) 1 0 6 District Heating 1 0 7 Electric Generation 0 0 8 Geothermal Housing 0 0 9 Education 0 0 Possible with water temperature at Pagosa Springs.

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Geothermal Stakeholder Association 24 VI. Examples of Economic Growth A. Industries Chart B. The ultimate Below the 690 apartments—not to mention the gyms, bars, dry cleaners and movie theater—that make up the 15-acre Linked Hybrid residential complex in Beijing, China, are 660 geothermal wells that eliminate the need for air conditioners and boilers . We might have the potential to heat 690 buildings without depleting our resource through re-injection. As knowledgeable community we determine our future!

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Geothermal Stakeholder Association 25 VII. How do we get started? A. Pay for the study at our own contribution level 1. Individuals 2. Businesses 3. Public/Private Groups (Community agencies, projects etc.) B. We prepare to receive and use 'bankable' reports from the study over a period of 12 months or more

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Geothermal Stakeholder Association 26 VIII. How can we prepare ? Establish "Geothermal Stakeholders Advisory Group" (GSAG) A. Distribute and Publish reports B. Use networking to 1. answer questions 2. stay informed 3. become a source of information 4. offer training sessions 5. continued active protection of: a. the Source b. our community

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Geothermal Stakeholder Association 27 One last gratitude goes out to YOU! IX. Thank you! Let's start working on our Economic Development A. Offering our check Payable to Geothermal Greenhouse Partnership ( 501c3 corporation) B. Collect other checks C. Issue receipts with a copy of E scrow Agreement Review Escrow Stipulations D. Please sign up for GSAG membership E. The first GSAG meeting set for Friday, April 8, 2011 Questions?