Generate geothermal power, and extract enough lithium from the briny water those plants emit to match a quarter of the world's supply of the metal.

It's a clean energy twofer of sorts, and it's what energy project financier Hannon Armstrong has in mind for geothermal projects it's backing in California's Imperial Valley.

That's the southeastern corner of the state, known for its hot desert and its Salton Sea, the lake formed by an accidental irrigation project overflow in the early 20th century that has some of the saltiest, nastiest water to be found anywhere.

But the same underground salts that have made the Salton Sea's waters so unpleasant also could provide geothermal projects in the region with a gold mine – or more accurately, a lithium mine – to exploit.

That's according to Hannon CEO Jeff Eckel, who spoke Wednesday at the Renewable Energy Finance Forum-WEST in San Francisco.

To get at that lithium, Hannon is turning to startup Simbol Mining, a Lawrence Livermore National Laboratory spinout formed in 2007 that raised $6.7 million in a series A round led by Mohr Davidow Ventures and Firelake Partners in 2008 (see Green Light post).

Hannon subsidiary EnergySource is partners with Catalyst Renewables Corp. in the Hudson Ranch project, a 50-megawatt geothermal plant being built for about $400 million in Imperial County, Eckel said. Arizona utility Salt River Project said in 2007 that it would buy the power from the plant, once it's up and running in 2011.

Beyond selling the clean, renewable power, however, "we are extracting lithium from the geothermal brine – the nastiest, metal-laden brine that's known in the geothermal business," Eckel said.

Four more 50-megawatt geothermal plants are on the drawing boards, and each is looking to "rent" brine streams to Simbol to extract the lithium in the water, Eckel said.

Each plant's brine stream could potentially yield an amount of lithium equal to about 5 percent of the world's current production of the ultra-light metal, he said. Add up five plants, and that's a quarter of the world's supply.

Global lithium production stood at about 28,000 metric tons in 2008, with 82 percent of it from Australia, Argentina and Chile, according to Roskill Information Service. While a small amount is made from lithium-containing minerals, most of it is extracted from brine-filled evaporation ponds.

Simbol's process is a lot more environmentally friendly than those brine ponds, Eckel said. It's also meant to be much less expensive, Simbol CEO Luka Erceg told Greentech Media last year.

With the lithium-ion battery industry set to grow dramatically in the coming years, there's no doubt there will be growing demand for the mineral (see A123 Closes Above $20: 50% Jump on IPO).

Whether or not global supply will be strained by that increased demand, on the other hand, is a topic of some debate.

While some analysts have said the world could face a crunch, Ted Miller, senior manager of energy storage research at Ford Motor Co., said at an August conference at IBM's Almaden laboratory that existing proven lithium reserves are far more than adequate for the car industry (see What's Next in Lithium Batteries?).

Not all geothermal plants can do what Hannan and Simbol plan in the Imperial Valley, since that region has an unusual combination of geothermal resources and briny, lithium-laden water, Eckel noted.