Research Shows San Andreas Fault May Be Overdue For Large Earthquake

A geothermal energy plant taps deep underground heat from the southern San Andreas Fault rift zone near the Salton Sea on July 6 near Calipatria, California.

Many of the things that arguably make wind and solar less than perfect energy sources don’t seem to trouble geothermal energy. Bird kills, intermittent output, low capacity factors, lack of dispatchability – no issues there with geothermal. Yet while wind and solar have sprinted forward in the past decade in the United States, geothermal has by comparison stood still.

Wind passed geothermal in annual generation in 2005 and this year will yield more than ten times the electricity. And now solar has closed the gap. As recently as 2009, geothermal generated 15,009 gigawatt-hours of electricity compared to just 891 GWh from solar. But in the first half of 2014, solar had moved out in front, 8,535 to 8,108 GWh.

So what’s geothermal’s problem?

Well, the first thing Karl Gawell, executive director of the Geothermal Energy Association, wants you to know is that outside the United States – the longtime world leader – geothermal doesn’t have a problem.

“We’re seeing strong growth in the international market,” Gawell said last week in an interview at the GEA Expo in Portland, Oregon. “Indonesia and the Philippines both could equal or surpass the United States in the next several years. East Africa is a very dynamic market. You’re seeing Kenya move forward with really strong growth. In Central America we’ve got projects in Costa Rica, Guatemala. We’re seeing growth, development today, in something like 70 or more countries around the world.”

The driver behind overseas geothermal growth is simple: growing, under-powered economies need energy and many have excellent untapped geothermal resources. “If you build a geothermal power plant in Kenya, there’s a buyer for your electricity,” Gawell said. Different story in the United States, which Gawell characterizes as a “transition” market.

“It’s a tougher market to work in because it’s much more of a zero-sum game,” he said.

That hasn’t always been the case. Geothermal grew dramatically in the United States in the late 1970s and throughout the ’80s, becoming the largest source of renewable energy after big hydropower, largely in response to the Public Utility Regulatory Policies Act, which required utilities to buy power from anyone who could offer it to them at less than “avoided cost” – what it would cost the utility to generate the power.

But PURPA’s impact has faded, especially in the current era of cheap natural gas generation. Meanwhile, state policies requiring greater shares of renewable energy generally haven’t differentiated between what type of renewable is used. And that, Gawell argues, has magnified geothermal’s drawbacks while under-valuing its positive attributes.

Geoscience Center Seeks Energy From Underground

Workers, at the request of the photographer, walk among test generators at an experimental geothermal facility operated by the German Research Center for Geosciences at the Helmholtz Center in Postdam on September 12, 2012 near Schorfheide, Germany. The turbines, rated at about one megawatt, will use heat in water pumped from deep underground and transferred via an organic rankine cycle. The project is funded by the German Ministry of Environment and researchers are seeking efficient ways to both create electricity and heat homes with geothermal energy.

“Geothermal offers reliability, firming, inertia – attributes that are unique among renewables,” Gawell said. This is a move beyond the traditional presentation of geothermal as a baseload power source; the geothermal industry wants you to know it can ramp electrical output up and down, much like a natural gas plant. Grid operators like this. “Those are things that if you properly value them, can really change the equation. Particularly as we move toward 30, 40 or even 50 percent renewables, these are areas where the regulatory system has to catch up.”

That’s one side of a policy overhaul that Gawell and the industry are pushing for. The other side speaks to cost, which – in a unique way – is geothermal energy’s Achilles’ heel.

By one of the most common measures, levelized cost of energy, geothermal is a cheap source of electricity – at $47.9 per megawatt-hour, it even beats advanced combined cycle natural gas ($64.4/MWh), according to the U.S. Energy Information Administration. But Gawell calls that a “perfect world” scenario – it assumes a site with excellent odds of turning up a good geothermal resource, as well as a smooth regulatory process. But not all sites work out so well (and the regulatory process can be torturous, Gawell said).

“Our biggest gap right now is drilling risk,” he said. A solar power plant and, to some degree, a wind power plant, is pretty much a sure thing to produce a certain amount of power. But with geothermal, you could hit what’s known as a “dry hole” and end up with nothing.

“Basically, no one is going to finance drilling risk,” Gawell said. “The risk is so high commercial lenders don’t want to touch it.”

Retroactive extension of the federal Production Tax Credit would help spur “a sudden boomlet in geothermal projects” already in the queue, Gawell said. In California, the industry has been pushing for – and recently narrowly failed in getting – a requirement that utilities add 500 megawatts of new geothermal capacity in the next decade.

Longer term, the industry is hoping to address the “dry hole” risk through what’s known as enhanced geothermal systems. Whereas traditional geothermal energy requires a pool of hot underground water, EGS forces pressurized fluid into hot rock formations – which are much easier to find.

Gawell: “One of the companies testified in Congress and said, “Right here, on Capitol Hill in Washington, D.C., you drill down 20,000 feet and the rock is boiling hot. There’s no natural reservoir there – but can we create one.’”

Gawell said early EGS work in Nevada, California and Oregon has shown promise. And even without taking EGS into consideration, a 2012 National Renewable Energy Laboratory study of scenarios for high penetration of renewables showed U.S. geothermal capacity growing from its current 3.4 gigawatts to as much as 25 GW in 2050, accounting for 4.2 percent of the generation. And much of the geothermal’s growth could come in the next decade, NREL said.

“That may not be a huge amount when you look at the total U.S. power picture but for geothermal, that’s a pretty good growth market,” Gawell said.