Sierra Geothermal Provides Tier One Projects Update

  Sierra Geothermal Power Corp. (SGP) (TSX VENTURE: SRA) provides an exploration update on its Tier One projects. The update covers exploration drilling at the Reese River Project, the completion of an observation well at the Alum Project in the Paymaster District as well as other Paymaster District advances, and the completion of an airborne survey at the Barren Hills Project.

In addition, SGP has been informed that Nevada's Bureau of Land Management has accepted SGP's lease unitization proposals for all four of SGP's Tier One projects. Lease unitization gives SGP resource control, during exploration, development and production, over land that adjoins each of the Tier One projects and that is not currently under lease by SGP or other developers. The BLM unitization approval affects a combined 47 square kilometers of currently unleased adjoining lands, for a total unitized and leased land position of 154 square kilometers on our Tier One projects.

"The Reese River exploration program was particularly helpful as it increased the size of the thermal anomally and will help us to target future drilling locations," said Gary Thompson, President and CEO. "We believe that our short term geothermal exploration program, which is well funded with nearly US$11 million raised since August 2009 and US$10 million in matching grants, will go a long way towards attracting prospective joint venture partners and moving our project to feasibility."

REESE RIVER PROJECT UPDATE

Earlier this month SGP completed a program of 10 shallow exploration holes with a total of 2,140 meters drilled at Reese River. While analysis of the drill results remains to be completed, an initial review confirms that the size of the known thermal anomaly at Reese River is greater than previously disclosed.

A team of geologists from the University of Nevada, Reno is working with SGP to build a structural model of the subsurface that should be completed in early 2010. The structural model, combined with all of the previous data, will be used for targeting the next drill locations.

PAYMASTER DISTRICT UPDATE

Paymaster is a district play geothermal opportunity located in Esmeralda County, Nevada near the California and Nevada border. SGP's projects within the District consist of three prospects: Alum, Silver Peak and Pearl, having an estimated combined probability at the 90% level of generating 110 megawatts of power. A 110-megawatt geothermal plant provides enough power to supply 88,000 homes. Alum and Silver Peak are Tier One projects while Pearl is a lower priority Tier Two project.

SGP recently completed drilling the observation well 25-29 at the Alum project, within SGP's Paymaster district. SGP stopped the well at 1,010 meters, which was short of the previously disclosed target depth of 1,830 meters. The highest recorded temperature in the well was 126 degrees Celsius at 620 meters depth. The drilling was stopped prior to the planned depth of 1,830 meters because a temperature reversal was encountered. The drill hole confirms and constrains the depths to important subsurface horizons and has provided helpful geologic information. SGP also collected a complete suite of downhole geophysical logs from the well. SGP is refining the 3D subsurface model at the Alum project prior to additional drilling.

In November, SGP completed detailed ground-based magnetotelluric (MT) surveys and airborne Z-tipper Electromagnetic (ZTEM) surveys at both Alum and Silver Peak. Preliminary analysis of the MT datasets reveals the extent and thickness of overlying layers of conductive sediments as well as the inferred locations of zones of potential permeability at both Alum and Silver Peak. A radiometric survey was recently completed at Silver Peak. Data processing and interpretation of all data sets into 3D subsurface models is ongoing.

SGP is planning additional exploration work in the Paymaster District including a 2D seismic survey at Alum, regional hydrological studies, shallow temperature probe measurements and an airborne thermal infrared remote-sensing survey at both Alum and Silver Peak. Further drilling is planned at both Silver Peak and Alum in January 2010.

As previously disclosed, SGP's $10 million in matching grants from the US Department of Energy allows SGP to obtain reimbursements for 50% of the cost of its exploration work, specifically $5 million of reimbursments for Silver Peak and $5 million of reimbursments for Alum.

BARREN HILLS PROJECT UPDATE

In November 2009, SGP completed an airborne Z-tipper Electromagnetic (ZTEM) survey covering 100 square kilometers at the Barren Hills project. This survey is providing information on the subsurface resistivity variations which is useful for planning additional surveys and drilling targets. The permitting process continues to move forward at Barren Hills. SGP anticipates the receipt of the major project permit, the Environmental Assessment (EA) for Barren Hills, in Q2 2010.

About Sierra Geothermal Power Corp.

Sierra Geothermal Power Corp. is a renewable energy company focused on the exploration and development of clean, sustainable geothermal power. It is based in Vancouver, British Columbia and listed on the TSX Venture Exchange under the symbol SRA. Its portfolio of geothermal projects located in Nevada and California exceeds 365 square kilometers (90,000 acres) and has a combined total estimated capacity of greater than 500 MW. SGP intends to finance development by utilizing a combination of corporate equity, joint venture partnerships and project debt, with the support of US government grants and loan guarantees. To find out more about Sierra Geothermal Power Corp. (TSX VENTURE: SRA) visit our website at www.sierrageopower.com.

On behalf of the Board of Directors,

Gary Thompson, President, Chief Executive Officer and Director

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This press release contains forward-looking statements. Forward-looking statements are projections of events, revenues, income, future economic performance or management's plans and objectives for future operations. In some cases you can identify forward-looking statements by the use of terminology such as "may", "should", "anticipates", "believes", "expects", "intends", "forecasts", "plans", "future", "strategy", or words of similar meaning. Forward-looking statements in this press release include statements such as, "The Reese River exploration program was particularly helpful as it increased the size of the thermal anomaly and will help us to target future drilling locations, we believe that our short term geothermal exploration program, which is well funded with nearly US$11 million raised since August 2009 and US$10 million in matching grants, will go a long way towards attracting prospective joint venture partners and moving our project to feasibility, SGP anticipates the receipt of the major permit, the Environmental Assessment (EA) for Barren Hills, in Q2 2010 and the Company's intent to finance the development of its projects through a combination of corporate equity, joint venture partnerships and project debt with the support of U.S. government grants and loan guarantees. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks inherent in our industry, the challenging capital markets and other risks identified by us in our periodic filings on SEDAR (which can be viewed at www.sedar.com). Any of these risks could cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

While these forward-looking statements and any assumptions upon which they are based are made in good faith and reflect our current judgment regarding the direction of its business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this press release. Except as required by applicable law, including the securities laws of Canada, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

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Contacts: Sierra Geothermal Power Corp. Gary Thompson President & CEO [phone] / 1-800-563-5631 [e-mail] Sierra Geothermal Power Corp. Anthony Srdanovic Investor Relations [phone] [e-mail] www.sierrageopower.com