The U.S. geothermal industry's recent innovations contribute to increasing potential for the use of geothermal to power the renewable energy future, but high upfront risks and costs of development are one reason geothermal needs federal funding programs to expand.

“Federal and state incentives help attract investors to geothermal projects, and are essential to overcoming the obstacles facing the industry today.  But, with continued growth and innovation, the cost and risk of projects should decline as the industry expands and technology improves,” according to Geothermal Energy Association (GEA) Executive Director Karl Gawell.

The 2005 Energy Policy Act provided new geothermal power plants the same tax incentive as wind projects: US$ 0.02 per kilowatt hour produced during each of the first ten years of production.

Well-known in the geothermal world is a report from the Massachusetts Institute of Technology (MIT) conducted in 2006, which arguably helped to usher in a focus on research for EGS.  "The Future of Geothermal Energy, Impact of Enhanced Geothermal Systems for the 21st Century” stated that EGS could provide the United States with about 100 gigawatt-equivalent of domestic capacity in the next 50 years.

Also of note was a 2010 workshop on “Exploration and Assessment of Geothermal Resources” in which The Great Basin Center for Geothermal Energy (GBCGE), the DOE Geothermal Technology Program office (DOE-GTP) and the GEA invited geothermal professionals to discuss the state of knowledge of exploration for geothermal resources.  The discussion revolved around exploration techniques in areas of Geology and Structure, Geophysics, Remote Sensing, Geochemistry, Temperature Distribution, and Reservoir Characterization. 

An understanding of geology is essential to the development process.  In Part 1 of this two-part look at geothermal technologies, the Geothermal Energy Association (GEA) examined some of the techniques and tools that are facilitating progress in geological testing and analysis for conventional and EGS geothermal projects.

Against this backdrop, GEA asked how DOE-funded geothermal projects are doing in a Q&A with the Department’s Geothermal Technologies Program’s Team Lead for Hydrothermal & Resource Confirmation Hildigunnur Thorsteinsson: 

GEA: From DOE’s standpoint, what advancements have been made in EGS since the MIT Report and why is EGS a big part of the portfolio in advancing geothermal technologies?

DOE: "At the Department, we see geothermal energy, all the way from conventional hydrothermal resources to EGS, as an important part of an all-of-the-above energy strategy that develops every available source of American energy. 

"While EGS has great potential to provide a large, clean, baseload, energy resource it can also help facilitate geothermal development outside of traditional hydrothermal areas in the western United States by extending geothermal energy production to additional areas in the country. 

"Building off the findings of the MIT study, we have worked with industry and university partners to enhance our understanding of the subsurface through advanced modeling and simulation methods.

"Energy Department research in safe, efficient stimulation and monitoring methods has helped advance a number of EGS demonstration projects. For example, through a DOE funded EGS demonstration project, Calpine was able to successfully create a new EGS reservoir by increasing permeability and connecting multiple wells in the north-west part of The Geysers field. 

"In addition, the DOE-funded AltaRock EGS demonstration is scheduled to initiate stimulation at their innovative EGS demonstration project in Oregon."

The projects that GTP accepts in its funding programs represent some of the some of the most creative geothermal innovations happening today to help bring the industry on a competitive track with other alternative energy options. 

The Department’s broader efforts for geothermal are to lower its development costs and reduce the technical and market barriers to increased production in the United States, Thorsteinsson told GEA. 

“Removing these barriers will ultimately strengthen the economic viability of geothermal development, and help provide a clean, renewable and reliable baseload resource for American homes and businesses,” Thorsteinsson said.

GEA: How will current GTP projects help to mitigate costs for the industry at large?

DOE: “The Geothermal Technologies Program is supporting a variety of projects aimed at prudently, safely and cost-effectively developing geothermal resources in the United States. As an example, we have supported research on the viability of using small-diameter core holes rather than full-diameter wells as exploration holes. This research is now paying significant dividends in the industry, helping to lower exploration and drilling costs for U.S. geothermal developers.

“Today, the Department is investing in several promising technologies to help further reduce costs,” she added. “For example, we are supporting an R&D project on percussive drilling technology that has the potential to significantly increase the rate of penetration in wells. This technology has been used with great success in mining and the project team is looking at ways to adapt the technology to the downhole environment of a geothermal well.” 

Small-diameter core holes and percussive drilling technology are just two areas of further research being carried out by DOE partners. 

Thorsteinsson hailed the work of James Faulds of the University of Nevada-Reno.  “At the recent Geothermal Resource Council meeting in Reno, our office recognized [Faulds] with the 2012 Peer Review Excellence Award for his team’s great work in characterizing structural controls of Enhanced Geothermal Systems (EGS) and conventional geothermal reservoirs.

“We look forward to working with our industry, national laboratory and university partners to continue these important research and demonstration projects,” she said.