Oct 07 2009

Geothermal: The Best and the Worst of Times

Posted by: Jonathan Marshall

These may be the best of times and the worst of times for geothermal energy.

Of late, the worst has garnered the most publicity, as stories in the New York Times have probed the link between deep-rock drilling, water injection and seismic events (read: earthquakes).

A promising demonstration project by geothermal pioneer AltaRock Energy at The Geysers in Sonoma County was suspended at the beginning of September due to "geologic anomalies."  Drilling problems also plagued Australia's Petratherm, Ltd. A well blowout set back another Australian geothermal leader, Geodynamics, Ltd.

And a much-touted new plant in Beaver, Utah isn't producing water hot enough to generate significant amounts of electricity--and will need millions of dollars in new investment to fix.

The good news, according to a new report from the Geothermal Energy Association, is that 144 new geothermal projects, totaling 7,000 megawatts of potential capacity, are being developed in 14 states.

If all come to fruition, admittedly unlikely, the total output would be enough to serve the needs of 7 million people.

Nevada leads with 64 projects with combined capacity of almost 3,500 MW. California is next with 37 projects that could supply as much as 2,400 MW.

Although the industry continues to make progress despite the recession, the high cost of drilling--and the uneven track record of companies pioneering deep geothermal wells--make financing these projects a challenge.

Companies also face long delays in getting drilling permits for federal sites from the Bureau of Land Management, which has been overwhelmed by demand from renewable energy developers, especially in the solar sector.

Industry veterans also complain on the long wait for stimulus funds from the Department of Energy's Geothermal Technologies Program.

"Investors are basically waiting to see who is going to get DOE funding," said the report's author, Dan Jennejohn. "They are more reluctant to invest in geothermal projects until the DOE funding comes out." 

© 2008 Pacific Gas and Electric Company. All Rights Reserved. Privacy Policy | Terms

"PG&E" refers to Pacific Gas and Electric Company, a subsidiary of PG&E Corporation.