Geothermal energy progresses - slowly  

Larvatus Prodeo has a post on the slow but steady progress Australian geothermal energy companies are making - Geothermal energy progresses - slowly.

The topic of “hot rock” geothermal energy has been covered a number of times in LP, the first being this post by Steve Edney back in 2006. Australia has little volcanically hot rocks close to the surface; however, in some parts of Australia, rocks kilometres below the surface are nice and toasty; warm enough to spin a steam turbine for electricity generation. All you need to do is drill a couple of holes down to it, either find or create some fractures between the holes, and circulate water through the hot rock. Simple, straightforward, and unlike just about every other form of clean energy out there, reliable and predictable. So it’s not surprising a number of companies have been looking to exploit this resource, one of the most promising sources of clean energy for Australia.

As far as I know, the furthest along is Geodynamics, who announced last week that they had achieved a “proof of concept”; while they didn’t actually generate any power, they circulated water through a pair of bores and monitored the temperature, enough to show that the bores could supply sufficiently hot water, for a long enough time, to run a pilot-scale power plant for years without an appreciable (and efficiency-sapping) drop in the water temperature. As a small shareholder in Geodynamics, I’m extremely pleased that this has finally been achieved. But the Geodynamics experience shows the importance of taking grand plans for innovative renewable energy technologies with large doses of salt. It always takes much longer, and costs a lot more money, than the early press releases claim, and many don’t make it through.


In Geodynamics’ case, if you have a look at their 2003 annual report, they predicted that they’d reach this stage by mid-2004, roughly 12 months after the annual report was produced. Instead, it’s taken nearly six years. There’s been all manner of setbacks along the way - as this 2007 4 Corners report explains a contractor dropped equipment down a well and it proved impossible to retrieve. At the time, the commodities boom meant that there simply wasn’t another drilling rig available, so the company waited more than year, and ended up spending tens of millions of dollars on purchasing their own drilling rig. But it’s hardly the only problem they’ve had to overcome along the way. And, in many ways, Geodynamics is pursuing relatively simple technology. They’re not inventing anything; their drilling rigs are straight from the oil industry, and the turbines are fairly standard technology purchased from elsewhere. But, still, even getting to “proof of concept” has been much slower and costlier than they claimed in the early phases of their company.

I still happen to think that HFR geothermal energy has a real future here in Australia, and Geodynamics are as likely as anybody to make a go of it, otherwise I’d sell my shares. But what it does show is the gap between rhetoric and reality for the clean energy sector - particularly in terms of its ability, right now, to start replacing large chunks of fossil fuel power - is real, and substantial. I think it’d help discussion greatly if the difference between “sounds good in the press release” and “we’re ready to deploy at bulk scale” was acknowledged more often and applied to all prospective energy generation technologies.