The geothermal energy industry is eyeing the Northern Territory as a key source of inexpensive and renewable energy. Susan Jeanes from the Australian Geothermal Energy Association says the introduction of the carbon tax has made it more worthwhile to invest in exploratory drilling.

Geothermal energy consultancy Hot Dry Rocks has worked with Google and hot rock experts overseas to estimate and map the planet’s reserves.

The preliminary heat-flow map for Australia shows SA, Queensland and the Northern Territory have the most abundant geothermal resources in the nation – we just have to tap into the resource.

Rocks within 5km of the surface of SA could generate 58,541MW of electricity if just 2 per cent of the heat were extracted, or 585,410MW if 20 per cent of the heat were extracted.

This is up to 168 times the amount of energy currently generated by coal and gas.

HDR managing director Graeme Beardsmore says that geothermal is “clean, renewable energy that is realistically accessible today with existing drilling and power conversion technologies”.

“Enhanced geothermal systems have the potential to provide base load power; it is one of the most abundant sources of renewable energy available and is more than sufficient to replace current coal and gas power supply,” he said.

Geothermal electricity is produced from energy released from superheated rocks lying kilometres below the earth’s surface. Ms Jeanes says drilling has already commenced in the Cooper Basin east of Alice Springs.

“What the problem for the industry is in this early exploration phase is that the rigs that we need to drill holes four and five kilometres deep cost about 50 million dollars,” she said. “There’s only one here in Australia and that’s the rig that’s owned by Geodynamics and that’s currently located in the Cooper Basin. So anybody else who wants to drill a deep well has to bring one in from overseas.”

Ms Jeanes says people need to embrace more clean energy sources. “The government has come and said we think this is a very important energy resource,” she said.

“They’ve got a policy program now that’s underpinned by a carbon price that will start to move some money for us. The market has to become more interested in clean energy sources. There are lot of clean energy options around but ultimately we’re the only renewable energy on the horizon that is baseload.”

Source: www.evwind.es

Briefly, geothermal power is thermal energy derived from the Earth’s geology. It is produced by drilling wells deep into the earth and tapping into underground heat, through naturally occurring steam or other heated fluids, to generate electricity. The use of geothermal power has grown steadily over the last several decades, reaching 10.7 GW of installed capacity worldwide in 2010. Pike Research forecasts that by 2020 global installed capacity will reach 25 GW.

For the moment, however, the barriers to new geothermal development are high. The biggest hurdle is access to financing; investors are wary because geothermal exploration carries a high resource risk (not all exploratory drilling leads to commercially productive resources) and long timelines for development. From discovery to commercial product can take as long as seven years; wind and solar farms, by contrast, can be up and running within two years.

Once operational, however, geothermal projects can provide clean, cheap power for decades.

Enhanced technology offers breakthroughs

While the geothermal power industry has been hit hard by the global recession–2010 saw only one plant come online in the United States–activity is expected to pick up sharply in the next few years. California, which boasts the strongest geothermal industry in the U.S., will see five new geothermal projects come online in the Salton Sea area, in Imperial County, in 2012.

What’s more, the advent of enhanced geothermal systems (EGS), which have the ability to tap deep, unconventional resources as opposed to the relatively shallow geothermal heat found in regions of volcanic and tectonic activity, promises to make many hundreds of megawatts available in the coming decade.

Countries with ample shallow geothermal resources, such as the United States, Indonesia, and the Philippines, are the primary focus of current production and development; but EGS, if it can be economically proven, promises to unlock geothermal energy from a wide range of countries and geologies. For that reason, geothermal energy is expected to increase as a percentage of the worldwide renewable energy mix, as growth accelerates in countries looking to exploit domestic resources.

Three countries in particular are poised to realize dramatic growth in their utilization of domestic geothermal resources: Australia, Kenya and Chile.

Although lacking the volcanic geothermal resources of some of its neighbors in the South Pacific (i.e., New Zealand, Philippines, and Indonesia), Australia is ground zero for the development of EGS technology. Currently, more than 50 companies exploring geothermal projects in Australia have taken out over 400 licenses for areas covering nearly 500,000 square kilometers, a combined area roughly the size of Spain. The Australian Geothermal Energy Association (AGEA) believes that, under current government incentives, the country could develop 2.2 GW of geothermal power by 2020.

With its power grid struggling to keep pace with rising demand, Kenya hopes to expand geothermal generating capacity by 4 GW over the next 20 years. Already the center of geothermal activity on the African continent and the target of significant foreign investment, the country currently generates 167 MW of geothermal power at the Olkaria geothermal field. Kenya’s potential geothermal resources are vast: the Rift Valley, in the western part of the country bordering Uganda, contains a projected seven to 10 GW of power potential.

In 2010, the energy minister of Chile, Ricardo Raineri, announced that the country would invest over $200 million in geothermal power projects and granted over 170 concessions to geothermal developers through 2012. Despite strong economic growth over the last decade, Chile’s geothermal resources remain untapped. The Chilean government hopes to increase the country’s geothermal capacity by more than 1 GW and eventually generate 20% of its electrical power from geothermal resources.

The geothermal industry in the United States, meanwhile, is the world’s most developed, with just over 3 MW of installed capacity. Currently 188 projects in 15 states are moving forward, with the potential to triple U.S. geothermal generating capacity. Pike Research believes that the United States could add up to 5.8 GW over the next decade. The major players with interests in geothermal, both U.S. and worldwide, include Chevron and Calpine.

For utilities, geothermal presents an appealing renewable option with sizable upfront risks. Geothermal power is not sporadic; the scale of the resources is huge; the fuel cost, once plants are built, is zero. Financing, transmission issues, exploration uncertainty and public opposition, however, all present significant downsides to aggressive development of geothermal resources in the near term. The successful development of economically viable EGS technology will go a long way toward allaying those concerns.

About the Author

Richard Martin is the editorial director of Pike Research. His writing on the future of energy has appeared in Time, Fortune, Wired, The Atlantic, The Asian Wall Street Journal and many other publications. His book on thorium power will be published by Macmillan Science in April 2012.

Source: www.fierceenergy.com

The Clean Energy Finance Corporation will start operating in 2013-14 with more than double the seed capital of its overseas counterpart, Britain’s $4.5bn Green Investment Bank.

And green power projects — excluding nuclear, biofuels from native forest woodwaste, and carbon capture and storage — will take up at least half the fund’s capital, after lobbying by the Greens.

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Greens deputy leader Christine Milne said the dedicated funding represented the biggest single investment in renewable energy Australia has ever made.

“With a legislatively guaranteed stream of funding outside the budget, no future government will be able to undermine it without changing the legislation,” she said.

The fund will share the remaining $5bn between the renewable energy, energy efficiency and low-emissions technology sectors and their supply chains, including manufacturers of wind turbines and solar panels. It will have a total fiscal impact of less than $1bn over the forward estimates because the investments will take the form of equity holdings and financing.

The fund, which will be independent of government and run by a board of banking, investment management, clean energy and technology experts, aims to partner with business to maximise investment in the sector.

The government believes $20bn will be spent on renewable energy projects in Australia in the next decade and $100bn by 2050. “Treasury modelling shows that with a carbon price, energy from the renewables sector is projected to account for around 40 per cent of our electricity generation by 2050, a significant increase from its current level of around 10 per cent,” it said yesterday.

The Australian Conservation Foundation’s Claire Maries expected the fund to shift the economy from coal and gas to renewables. “The end result is that we unlock a clean energy boom in Australia,” she said.

Professor McKibbin was concerned by the scale of the package’s subsidies for renewables.

“We know from the Productivity Comission report that that is a very high cost way of reducing carbon per unit . . . it has to be done in a way that is very carefully managed,” he said.

“I would prefer that the carbon price system itself generates enough incentives.”

The commission estimated that taxpayers have been subsidising the reduction of emissions at prices of up to $1000 a tonne through rooftop solar panels.

The new corporation is expected to make enough from its investments by July 2018 to be self-sustaining and to reinvest any dividends raised either in its own projects or those of the Australian Renewable Energy Agency.

The agency, announced last week, consolidates $3.2bn in existing federal funding programs for renewable energy technologies.

The $200m Clean Technology Innovation Program, will provide grants to business.

The renewable energy target — to source 20 per cent of electricity from green power by 2020 — will be maintained.

Source: www.theaustraliancom.au

Compared to the UK (29.79), the US ($5.19) and Japan (3.15) Australia is falling behind. By not adequately encouraging the switch to clean energies Australia is at risk of missing out on a new market that in future decades could potentially change the entire global economy.

Australia boasts a relatively high number of sunshine hours per year yet despite this the total energy contribution from solar farms is no more than 0.2 percent of the total national consumption.

Lend Lease Solar expects the use of commercial and Industrial Solar Power to increase steadily as the cost of manufacturing decreases and energy prices increase. Lend lease provides small scale roof top installations all the way up to large scale installations for utilities companies and so is an ideal indicator of the state of the renewable energy market in Australia today.

There is a huge amount of scope for renewable energies in Australia; the government needs to offer further incentives for companies to decrease their carbon output through taxes, feed in tariffs and a reinvestment of tax revenue into future projects and infrastructure.

Source: www.embraceaustralia.com

To achieve such reductions, however, it will be necessary for the US to reduce its greenhouse gas (GHG) emissions to zero within ten years. Because “Australia has about the same per-capita emissions as the USA,” according to the report, it too would have to pursue the same goal.

The report, entitled Zero Carbon Australia Stationary Energy Plan, “outlines a technically feasible and economically attractive way for Australia to transition to 100 percent renewable energy within ten years.” The plan specifies that the 100 percent renewable grid be “based on proven technologies that are already commercially available and that have already been demonstrated in large industries.”

In addition to assuming a significant reduction in energy consumption by means of implementing efficiency measures, the plan asserts that 98 percent of Australia’s energy needs can be met by wind generation and large-scale Concentrating Solar Thermal with molten salt storage. According to the plan, wind turbines will meet 40 percent of demand, and solar will provide the remaining 60 percent.

In addition to reducing Australia’s GHG emissions to zero, the plan will create up to 80,000 jobs from renewable energy installations, and an additional 45,000 jobs in operations and maintenance. According to the report, the transition to renewable energy will create many more jobs “than are lost with the phasing out of coal and gas from the stationary energy supply chain.”

The total cost of implementing the plan would be $370 billion, or three percent of Australia’s Gross Domestic Product (GDP). The plan is characterized by higher upfront investment, but lower ongoing costs than continuing reliance on the stationary energy sector.

The plan does not specify funding mechanisms; however, a letter [PDF] published last December by the United Nations’ Principles for Responsible Investment (PRI) addressed “the important role that capital markets, institutional investors and private finance, will play if the global community is to deliver the needed transformation to a low–carbon and resource-efficient global economy.”

Source: www. reuters.com This article originally appeared on SocialFunds.com, and is reprinted with permission.