With the planet's total energy consumption rising at an exponential rate and concerns about global warming being pushed to the forefront, alternative energy seems like less of a gamble and more of an eventuality. However, as investors and the media often focus on sexier forms of alternative power and technologies, basic, reliable forms of energy are often swept under the rug. These "here today" forms of renewable power can provide the bridge necessary until solar and wind can become more cost effective. One of these sources of abundant clean energy that is often overlooked is geothermal power.

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Geothermal energy is essentially power harnessed from the heat of the Earth. These sources can take forms including underground hot springs, geysers, volcanic activity and even radiant solar heat warming the ground. Water or steam is pumped through wells and turbines which produce electricity.

Geothermal energy has some special advantages over other forms of alternative energy. One of the more significant is that geothermal is a base load power source. The power source is always "on" and there is no start-up lag. Other benefits include its small environmental footprint and low cost. A geothermal plant, depending on the source of power, is comparable to the price of wind power, new coal plants or biomass operations.

In addition, utilities love the predictable long life income stream that geothermal plants can provide. PG & E Corporation's (NYSE: PCG) California Geyser project has been operating since the 1960s, and is now producing over 725 MW of geothermal energy each year.

The United States government has been taking notice of the advantages to geothermal energy, earmarking nearly $350 million from the American Reinvestment and Recovery Act towards these endeavors. That number includes some grants towards integrating geothermal energy production into oil and natural gas fields.

Ways to Play
While solar investors can just purchase an exchange traded fund such as the Claymore/MAC Global Solar Energy ETF (NYSE: TAN), investors wanting to participate in the geothermal space aren't so lucky. The sector isn't as large and has yet to warrant an ETF. However, there are some individual company choices in addition to the previous mentioned PG &E.

As the oldest and largest publicly traded geothermal company, Ormat Technologies (NYSE:ORA) should be considered a core holding. Through a vertically integrated model, Ormat develops, builds and operates geothermal power plants using its own designed and manufactured equipment. The company also provides several turn-key solutions for other utilities wanting to setup and operate geo plants.

The company has expanded worldwide, landing contracts to build plants in China. On August 5, Ormat released second-quarter earnings and reported a 24.9% increase in total revenue. Shares trade at nearly a 30 P/E, but given the lack of investment choice in geothermal and Ormat's premier status, the P/E is justified for longer-term investors. Shares of the company yield 0.65%.

In contrast to Ormat's everything business model, young upstart Raser Technologies, Inc. (NYSE: RZ) is following a different path. Using off-the-shelf turbine technology developed by diversified powerhouse United Technologies Corp. (NYSE: UTX), Raser creates modular geothermal plants, where additional generation capacity, if needed, can just be added. In addition, these plants are able to run off of lower temperatures allowing for shallower wells. The company is a start-up, but has real promise long term.

The Bottom Line
As we increase our energy consumption, new solutions will need to be created. However, until these solutions prove to be cost effective there are some underutilized renewable options. Geothermal energy represents one of the better bridge choices out there. Both industry standard Ormat and newcomer Raser, offer investors a chance to participate in this energy format's rise. (For a related reading, check out Five Investment Risks Created by Global Warming and Five Companies Leading The Green Charge)

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