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The Growth of Geothermal Power

The Growth of Geothermal Power

The growth of global renewable power capacities over the last decade has been staggering. In the United States the total installed capacity of wind power has grown tenfold over the last

decade. Global solar power capacity has similarly jumped from 4 gigawatts in 2004 to 40 gigawatts in 2014. Growth has been seen in all renewables, including hydropower, biomass, and biofuel. Yet geothermal energy has not experienced the same degree of growth. In 2013 the world geothermal power capacity grew just 3 percent, reaching 11,700 megawatts. In comparison, wind and solar power have grown at an annual 21% and 53% respectively since the 2007-08 financial crisis.

Interestingly, the strong growth of some renewable power sources and not others has little to do with the amount of potential energy on tap. The Earth Policy Institute, an independent non-profit environmental think tank, estimates that the upper six miles of the earth’s crust holds 50,000 times the energy embodied in the world’s oil and gas reserves. Test-drilling to assess heat resources, however, is more costly and fraught with an uncertainty not found in wind and solar assessments. This high upfront cost and no guarantee of finding a viable site often dissuades the development of geothermal plants despite their potential for 24 hour energy production irregardless of weather and low operation and maintenance costs.

The Nesjavellir Geothermal Power Plant in Þing...

Thirty percent of global geothermal energy production comes from the United States, nearly all of which is produced in California and Nevada. The Philippines and Indonesia produce another 30 percent of the global total, with 21 other nations making up the remainder of the 12,000 megawatt global capacity.

Despite so much of the global geothermal capacity being produced within the United States, our 3440 megawatts of geothermal energy account for less than 1 percent of our energy consumption. Iceland leads in geothermal share of electrical energy generation, with 29 percent of consumed energy being produced from the Earth’s heat. El Salvador follows in a close second, where 25 percent of its electricity comes from geothermal plants.

The development of geothermal plants has the potential to be an important and lasting answer to growing energy needs, particularly in equatorial and developing counties. Indonesia, for example,  is looking to develop 10,000 megawatts of geothermal energy by 2025. The Earth Policy Institute has listed nearly 40 countries that could get all their electricity from indigenous geothermal power, including: Ecuador, Ethiopia, Iceland, Kenya, Papua New Guinea, Peru, the Philippines, and Tanzania. The problem is the high upfront costs that prohibit geothermal development for many developing countries.

However, some governments and organizations have begun stepping up to address this issue. The Indonesian government passed a law in August that increases the guaranteed purchasing price of geothermal energy. The World Bank launched its Global Geothermal Development Plan early last year which is raising funds to identify and test-drill promising geothermal projects in the developing world. In doing so, they hope to lower the costs for the geothermal industry overall.

The state of California has a renewable energy portfolio standard that requires its incumbent utilities to provide at least a third of their electricity from renewable sources by 2020. Utilities, however, are more inclined to buy wind and solar energies that have more tax advantages. Would the requirement of utilities to procure more geothermal energy distort the energy marketplace? Similarly, access to the water required to produce the steam necessary to run geothermal plants may be an issue in the arid regions of the United States and elsewhere that have the most geothermal potential.

Geothermal energy may be limited to a nominal share of electricity production in the United States, but that doesn’t have to be so elsewhere. Paving the way for geothermal energy production does more than reduce energy poverty. This vastly untapped resource simultaneously reduces air pollution, carbon emissions, and costly fossil fuel imports. Further consideration of geothermal energy production is necessary when governments incentivize renewable energy sources and when industries begin to look for alternatives to high energy prices and carbon constraints.

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