Lockheed Martin Corp. is progressing with plans to build a 10-megawatt OTEC electrical generation plant off O'ahu in 2013, and possibly a 10-times-larger plant here or elsewhere two years after.

Lockheed detailed some of its plans at the state's Asia-Pacific Clean Energy Summit and Expo yesterday, saying the company has worked for two years on the pilot plant that would be on a platform about four miles off Kahe Point.

"We believe OTEC can really change a lot of things in the world of energy," said Ted Johnson, director of the project for Lockheed Martin.

"Our plan is to have it in the water by 2013."

OTEC, as it is commonly called, stands for ocean thermal energy conversion, a technology that exploits temperature differences between surface water and water found several thousand feet deep to run generators, desalinate water and possibly produce other types of fuels.

In an OTEC system, warm water is used to heat up a fluid with a low boiling point. In turn, this steam turns blades on a generator before being cooled down again by cold water pumped up from the ocean depths.

Both Hawai'i and Lockheed have a history with OTEC, with the world's only successful floating OTEC system being built and operated off the Big Island in the late 1970s. That project was funded by the National Science Foundation and funding dried up for the project as concern about spiking oil prices subsided.

Johnson said Lockheed decided to revive work on the technology several years ago as more people looked for renewable energy and oil prices began rising. It is updating the design with new technology drawn from its 146,000 employee work force, along with employing partners in the project such as Hawai'i's Makai Ocean Engineering Inc.

So far, Lockheed has funded some of the project on its own as well as attracted money from the Department of Defense and Department of Energy. OTEC has a significant advantage over most clean energy technologies in that it runs all the time and isn't affected by lack of wind or sunshine that disappears during cloudy weather.

Johnson's group is currently looking at the best ways to engineer a 12-foot diameter plastic pipe that would dip down 3,000 feet to draw up the cold water. Lockheed also is looking for ways to build bigger commercial plants with markets being considered in Guam, Taiwan, India, Australia, Florida and the Gulf of Mexico.

The Department of Defense is also interested in boosting use of renewable energy and is hoping OTEC can be used for bases here and elsewhere in the world.

"It's green and you guys own the energy," Johnson said.

Johnson said the 10-megawatt plant costs for producing power could be in the low 20-cent per kilowatt hour range, without taking into consideration any tax credits and incentives being offered for clean energy by the federal government. That's about the price range Hawai'i residents pay for their electricity.

Concurrently, plans are being drawn up for a 100-megawatt plant that could be built for use here, but could end up elsewhere. Johnson said there are many sites around Hawai'i that would make for good OTEC sites.