Geothermal to inch forward in 2013

Posted by Pete Danko, EarthTechling

A story popped up in my “geothermal power” feed on Sunday with the headline: “DOE set to award 4 renewable energy contracts.”

Holy cow, I said, some rare utility-scale geothermal action! I wondered where these projects might be happening. Oregon? Nevada? Uh, no. The Philippines.

This is how it goes with geothermal power development these days. There’s action, but not a lot of it is in the United States.

According to the Federal Energy Regulatory Commission, through November, geothermal accounted for 141 megawatts of new electrical generation in 2012. The Geothermal Energy Association put the 2012 figure at 147.05 MW, and noted that this was 5 percent more capacity than geothermal added in 2011, and was the industry’s second-biggest year since 2005.

Meanwhile, wind was headed toward something like 12,000 MW of new capacity (an admittedly skewed number, due to the push to install before the production tax credit expired, but still); and based on its performance through three quarters of 2012, solar was expecting a gain of 3,200 MW for the year.

The U.S. geothermal industry did get some good news in the past week, however: The fiscal cliff deal not only gave geothermal an extension on tax incentives – both production and investment tax credits – but instead of requiring that projects be in operation by the end of the 2013, they only need to be under construction. Wind power got a similar deal, which it said was important because wind plants can take so long to build. But geothermal timelines are even longer.

The GEA’s Karl Gaswell told Reuters that the changes could translate to $4 billion in new investment in geothermal projects.

Still, geothermal faces headwinds. Natural gas has bounced around a bit in price, but remains in a range that is historically and devastatingly cheap. Renewable portfolio standards should continue to direct a portion of new generating capacity toward clean energy projects, but as Greentech Media’s Herman K. Trabish pointed out recently, solar and wind are highly competitive against geothermal in that realm.

Geothermal is hoping for technological advances that can open up new possibilities, and points to enhanced geothermal systems (EGS) technology, its own version of fracking. Here’s how the U.S. Department of Energy explains it:

EGS is a man-made reservoir, created where there is hot rock but insufficient or little natural permeability or fluid saturation. In an EGS, fluid is injected into the subsurface under carefully controlled conditions, which cause pre-existing fractures to re-open, creating permeability.

An issue with EGS, however, is the “microseismic events” that can be caused; the industry and the DOE say these are so far underground and so tiny that induced seismicity, if undertaken with the latest protocol [PDF], shouldn’t be a problem.

Pete Danko, EarthTechling