GEOTHERMAL CHALLENGES

Growing Pains for Geothermal; A look at S-curves and drilling SNAFUs.
Toby Shute, September 4, 2009 (The Motley Fool via MSNBC)

"For some time now, I've been quietly rooting for geothermal power. It's clean, it's cheap, and unlike solar or wind, it provides a base load of power that doesn't depend on the sun shining or the wind blowing.

"…I spend much more time writing about the twists and turns of the solar industry…because there are so many more publicly traded solar businesses. Magma Energy [is] listed in Canada…Beyond Ormat, the pickings this side of the border are quite slim."

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"...[Technology S-cruves in renewable energy alterantives; Analysis and implications for industry and government, by Schilling and Esmundo,] has found that geothermal is both the most efficient alternative-energy technology and is also improving at the fastest rate…Picture flattish growth, followed by exponential growth, and then a flattening again -- hence the "S" shape. Geothermal and wind technologies are both in that steep middle phase, where they are making rapid efficiency gains, translating to a high return on R&D investment. Wind is further along that curve, while geothermal has shown no signs of slowing performance improvement. Solar is improving much more slowly.

"With geothermal poised to surpass the efficiency of fossil fuels with just a few billion dollars' more support (the authors peg the cost at $3.3 billion), the policy implications of this study are that our government funding priorities are out of whack…"

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"…[B]ut for geothermal to take the world by storm, it has to move beyond the exploitation of natural reservoirs such as occur at Calpine's Geysers facility and move to Enhanced Geothermal Systems (EGS) that can pull the heat out of hot dry rock. Unfortunately, such projects have seriously stumbled lately…Australia's Geodynamics.. had an explosion at its Habanero 3 well in April. Commissioning continues to be delayed…[and] AltaRock Energy [in which Google's foundation invested] suspended drilling at the Geysers after failing to make it more than a third of its way to total depth [due to possible seismic disturbances]…This is disappointing…[but not] insurmountable…

"The geothermal industry, with a fraction of the government money thrown at fossil fuels over the years, will figure out how to drill through 12,000 feet of rock [just as the oil industry has]...[C]ommercialization of EGS would certainly be easier if the oil and gas industry would clue the geothermal folks in on the dark arts of deep drilling. The conspiratorially minded among us may conclude that the energy majors have no such interest in doing so…Even though Chevron is the biggest geothermal producer in the world, I certainly don't see the company [pushing EGS]…[and] companies such as Royal Dutch Shell and ExxonMobil [prefer] biofuels. But with or without [help]…I do expect the geothermal business to grow by leaps and bounds…"