Geothermal technology offers renewable energy that comes from
under the earth. The energy is baseload, dispatchable, and 100-percent
renewable. The industry is making slow-but-steady progress in various
regions of the world. As attendees head to the Geothermal Energy Expo
and Geothermal Resources Council Annual Meeting in this week, we ask our
readers this issue’s Big Question.
Director of Communications, Geothermal Resources Council
In organizing the biggest annual event in the industry (the GRC
Annual Meeting & the GEA Geothermal Energy Expo), the Geothermal
Resources Council (GRC) gets an insight into current trends. From these,
we can see that the biggest opportunities remain in Indonesia and The
Philippines in Asia and in Kenya and Ethiopia in Africa.
However, the recent news that the Japanese government will allow
drilling for geothermal resources in parts of national parks bodes well
for the industry there. Also, new legislation in Mexico will potentially
be a boon for geothermal energy. I hope legislation will be passed to restore the Salton Sea in
Southern California. This would involve the development of more than a
GW of geothermal energy, providing a much-needed push for the industry
in the United States.
In addition, the research into Enhanced Geothermal Resources (EGS)
here in the United States, in particular at the Frontier Observatory for
Research in Geothermal Energy (FORGE) program, might provide the
breakthrough for the industry that will make geothermal energy available
anywhere in the world.
There are probably many untapped areas. But in Kenya, they have
enough geothermal potential to possibly power a major part of East
Africa. The added bonus is that the transmission lines that are being
installed for the Lake Turkana Wind Project pass close by allowing
connection points and substations to be built. External companies should
be encouraged to invest and be a part of Kenya’s 5,000-MW vision for
future energy provision.
The age-old issue for geothermal power generation is proving
resources and developing risk with a utility rate of return on
completing a successful project. This single issue has sidelined
potential projects for decades. Sponsor Energy Capital is forming a fund
to solve this issue for worthy projects.
Geothermal is abundant in many places around the globe. I see the
real problem as that in most areas where geothermal is present, there is
insufficient grid capacity to handle the load that can be generated.
If you closely examine the geothermal domes that exist throughout the
southwestern United States, for example, you will find that the grid
necessary to support larger amounts of energy is not present or is
dedicated to the transfer of energy from areas supplied by larger
fossil-fuel generation plants. The costs to upgrade this power structure and to connect these plants
to the grid end up being higher than the developers of the projects can
bear.
Craig Immel
Founder, Steady State Asset Partners
There are two important trends in geothermal energy that have the
opportunity to drive new growth in the ground-source heat pump industry.
First, the development of innovative geothermal HVAC-financing models
will enable many more buildings to keep their occupants comfortable
while conserving energy and keeping operating costs low.
These new business models are allowing property owners to avoid large
upfront cash outlays for upgrading to geothermal while still keeping
monthly cash payments below their properties’ previous monthly heating
and cooling bills.
The geothermal industry is following in the footsteps of successful
solar PV financing models, which are growing rapidly by selling
no-money-down solar installations. Second, there is a growing recognition that geothermal heat pump
systems can be used for thermal energy storage. While there is a lot
excitement around solar PV and grid storage, much of that electricity is
ultimately used to provide thermal comfort and water heating.
Storing BTUs underground and simply pumping them into or out of
buildings as needed is a smart way to use electricity and heat energy.
It is also a great opportunity for utilities to comply with the Clean
Power Plan by reducing overall energy loads on the grid.
In California, we need the California Independent System Operator
(CAISO) to recognize the importance of geothermal energy and eliminate
barriers to its development. There is something wrong when geothermal is only 4 percent of
California’s renewable energy portfolio. The area around the southern
end of the Salton Sea is the richest deposit of geothermal energy in
North America and has resources to replace the shuttering of San Onofre.
Today there are almost 80 countries around the world at some stage of
exploring or developing their geothermal resources, so there are
opportunities on every continent. The best scenarios for success and
growth are those where there is an understanding of the resource and
geology, the governments support its development and the economies needs
power. All three of these factors are found in East Africa,
particularly in Kenya and Ethiopia, making this a leading region for
geothermal opportunities.
Equally strong potential exists for new geothermal development in
Mexico and Indonesia as these governments each move forward on
geothermal initiatives and open doors for new investment. Opportunities
also abound in the ripening geothermal markets of Central American
countries, Caribbean Islands, and Pacific Islands.
But don’t write off the United States. As climate emissions become a
market driver, the firm and flexible attributes of geothermal power make
it an essential part of any greenhouse gas emissions reduction plan.
Only a small fraction of geothermal resources are developed, so it’s
still a pioneer industry with a lot of room for advancement.
To take advantage of the opportunities, first support GEA as it works
to open and promote new markets and to keep companies informed of new
opportunities. Second, develop the best technology and the best team.
Then prepare your plans knowing the risks...and seeking to reap rewards.
Karl Gawell
Geothermal Energy Association
Geothermal opportunities are best capitalized upon in physical
locations where the potential exists. Such opportunities are greatest on
or near major volcanic activities or tectonic plate underlap areas. The
entire tectono-magmatic activities around the Red Sea gave rise to
several geothermal provinces over the continents surrounding the Red
Sea, represented by thermal springs and fumaroles at several locations
in the State of Eretria, Djibouti, Ethiopia, Yemen and Saudi Arabia. Ideally, an offshore system in the Red Sea could provide a major
source of steam energy for electrical production. A high-voltage DC
undersea cable could carry this energy ashore for mass storage or
immediate use.
The United States Navy Operates the COSO Geothermal Well in
California. The energy produced from this facility powers an entire base
plus overcapacity for adjoining communities. Geothermal planning requires high-quality research on understanding
location, technology, environmental impact, the cost of feeder
transmission lines, mass storage, maintenance and operation. Most geothermal systems require extensive maintenance and lifecycle
support which must be factored into the business case for any such
project.
The perspectives on what constitutes a great geothermal opportunity
differ. For developers and investors, it is about accessibility and
supporting schemes. For suppliers, it is about the market structure,
openness and competitiveness.
Overall, the key markets for suppliers are Indonesia, Philippines,
Kenya, Turkey, Mexico, and the several smaller nations with smaller
projects. For investors supporting schemes such as the Geothermal Risk
Mitigation Facility in Eastern Africa, a new insurance scheme in Mexico
and Latin America, as well as good feed-in-tariffs, are helpful. Germany, for that matter, still is likely one of the better return
opportunities, despite its smaller project size and higher perceived
risk.
There are some good geothermal resources in East Texas.
One of the things that concerns me the most about geothermal is the
water withdrawal and consumption. I know that a lot of companies are
looking for ways to reduce their water impact (in particular by using
recycled water - much like in the natural gas industry), but the water
component is still one I think needs to be part of any discussion.
If the geothermal potential is in areas that are predicted to see an
increase in drought or heatwaves in the coming decades, I think that
water availability should be part of the calculus of whether it is worth
harvesting those resources. At the very least, developers should
consider how to be smart about reducing their freshwater use.
When we talk about geothermal energy development, we should not
forget geothermal, or ground-source, heat pumps (GHPs). This technology
for the past few decades has been quietly building its contribution to
pollution reduction, job creation, and energy/cost savings for millions
of people around the world.
Here in the United States, it’s a “50-state” technology that is not
dependent on ideal natural conditions of heat source availability and
permeable rock. Around 700 MWt of capacity is installed every year in the United
States alone, by far outpacing development of “hot rocks” on an
equivalency basis with electrical production. Best of all, GHPs
eliminate onsite use of fossil fuels like fuel oil, natural gas, and
propane that are not only pollutants, but are hazardous as they are
burned by conventional equipment.
The GHP industry is still nascent in the United States, primarily
because of its higher upfront installation cost. This cost is due to the
need for excavation or drilling to install ground-loop heat-exchange
systems. The industry is working to overcome that initial cost barrier through
innovative financing that secures cost savings immediately for building
owners. It is also seeking to apply government incentives resulting
from amendments to energy-efficiency laws and renewable-energy portfolio
standards.
The industry also advocates renewal of its tax credits for
residential and commercial installations at the federal level, which are
set to expire next year. Several business tax incentives are now under
scrutiny by a cost-conscious Congress. Most of all, the GHP industry must continue its efforts to inform the
public about its economic and environmental advantages, especially
carbon emission reduction, at a time when climate change is on
everyone’s minds.
http://www.renewableenergyworld.com/articles/print/volume-18/issue-9/departments-columns/the-big-question-where-are-the-major-geothermal-opportunities-around-the-world-today-and-what-should-the-industry-do-to-take-advantage-of-them.html
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