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Going Down Under, Down Under

by Richard T. Stuebi

Geothermal energy has been part of the electricity grid for about 100 years.  By using the heat from underground sources, steam can be generated to spin a turbine. 

This is a pretty straightforward concept, and it’s generally an economically-attractive power generation option where the underground heat — either steam or hot water — is at or very near the surface.  In turn, this tends to occur only along seismic rift zones or in areas of volcanic activity, such as Iceland.  In other words, geothermal energy has generally not been a viable alternative for much of the planet.

However, as oil/gas drilling and production has gotten more technologically-advanced, the frontier of underground resource recovery continues to deepen.  The development of “fracking” technology to crack geologic layers via fluids under high pressures is being appropriated from hydrocarbon to geothermal energy, with the investigation of enhanced geothermal systems (EGS)

EGS technology can take advantage of the unassailable fact that there is an abundance of thermal energy in the earth’s core — if you go deep enough.  According to MIT’s 2007 report “The Future of Geothermal Energy”, the U.S. has 140,000 times the amount of deep geothermal energy resource than its annual energy consumption.  Unfortunately, it’s 2-6 miles deep, and in tight rock formations, so that’s why the most advanced oil/gas technologies such as fracking need to be employed.

In a recent overview of EGS development by the Economist, it seems that Australia is leading the way in technological advancement:  with about $2 billion of investment over the period 2002-2014, “more than 50 companies exploring geothermal projects in Australia have taken out over 400 licenses for areas covering…a combined area roughly the size of Spain.” 

Of course, as always with new energy technologies, the main challenge is economics.  The technology can and almost certainly will work, but the question is whether it can produce electricity in a manner that generates sufficient returns to encourage investors to shell mega-bucks up front to drill down a few miles for heat.  Current projections indicate a cost of almost $0.20/kwh, though reductions should be capturable if/as the technology matures.

As with almost anything in the new energy frontier, the maturation of EGS technology would appear to be a question of will, and when.