The first power plant in Australia to produce electricity using an enhanced geothermal ("hot rocks") system has begun producing electricity in the far north-east of South Australia.

The one-megawatt Habanero pilot plant near outback Innamincka is operated by Geodynamics.

Geodynamics CEO, Geoff Ward, said that "It's a globally-significant demonstration test and the results that we've seen at Habanero suggest that we have discovered the most productive EGS system in the world. It's hotter than the other systems that are operating."

A testing programme at the site is due for completion in August.