Is Geothermal The Baseload Alternative?


On Tuesday, the media pack woke up to a post-clean coal Ian Macfarlane. "The reality is," he had said in the Four Corners report of the night before, "you are not going to see another coal fired power station built in Australia. You can talk about all the stuff you like about carbon capture storage, that concept will not materialise for 20 years, and probably never".

AM‘s Alexandra Kirk got on to Martin Ferguson, Rudd’s Minister for Resources and Energy, early the next morning. "If clean coal proves unachievable, doesn’t that leave nuclear as the only viable option for baseload electricity reduction?"

No, actually, it doesn’t. Like so many others, this question fails to take into account the promise of geothermally generated electricity as a viable baseload energy source. Geothermal, or "hot rocks", is clean, abundant and cheap power.

By clean, we’re talking about zero emissions to produce, with no waste.

And by abundant? When he launched the deep-drilling phase of Petratherm’s Paralana project in South Australia, Martin Ferguson asserted that just 1 per cent of geothermal reserves could produce 26,000 years’ worth of electricity.

Every politician or industry spokesperson, when caught in the spotlight of business-as-usual energy policy, will rattle off the "alternative energy sources" to be "part of the mix". Solar and wind. Wind, tidal and solar. We all know that these can’t yet deliver baseload. If geothermal can — and it is so clean and so abundant — why have we heard so little about it?

The fact is, Australia has still got about 90 billion tonnes of coal in the ground so there’s not a lot of pressure coming from electricity companies to find alternative baseload sources. The export price of coal will move in only one direction: up. Volume’s going up too: forecasts by the Australian Bureau of Agricultural and Resource Economics (ABARE) predict that Australia will export 140 million tonnes of coal in the 2009/2010 financial year, up 2.6 per cent from the previous year. That’s a lot of coal being dug out of the ground, sold and burnt.

Nevertheless, the potential of geothermal is beginning to emerge through a smog of misinformation. The nascent industry received a major boost last week when Ferguson announced $235 million in funding. Two leading geothermal development companies, Geodynamics and Petratherm, will get $90 million and $63 million respectively.

Currently there are 48 companies exploring for geothermal sites in Australia and several of these expect to have projects running within two to five years. Geodynamics’ project in the Cooper Basin near Innamincka in South Australia is one of the more advanced and the company believes it will soon have energy available for industrial use.

Around the world, 24 countries already generate geothermal energy, among them the United States, Iceland, New Zealand, Italy and Japan. They predominantly use water that has already been heated by volcanic springs rather than heating it by flushing it through hot rocks as we do in Australia. And it’s growing rapidly: the Earth Policy Institute predicts as many as 46 countries may be generating geothermal power by the end of next year.

To harvest geothermal energy, you need to drill four to five kilometres below the surface where the rock temperatures are 200 degrees or more, hot enough for the liquid they heat to drive turbines. The first challenge is to get wells down into this layer to check that the rocks are hot enough. If they are, you can pump water into the rock at a pressure high enough to fracture the rock and to allow the water to move through the fractures, forming a reservoir. Then other wells are drilled and the hot water is pumped back up to the surface where it drives the turbines.

Once the system is up and running, this hot water can be constantly recycled. There are no other inputs into the process. Unlike wind and solar, it does not rely on specific weather conditions. And apart from the wells, there is no "mine" as such: minimal demands are made of the land. Geothermal is a renewable energy source that taps the ceaseless heat production at the earth’s core as it radiates towards the surface.

The first discoveries of these "hot rocks" in Australia were in South Australia. Discoveries of hot rocks beneath layers of brown coal in the La Trobe Valley have led to speculation that coal acts as an insulator for the rocks. Indeed, it seems that brown coal is a better insulator of hot rocks than black coal for the same reason that it’s a dirtier power source — because it’s wetter. Beyond this, the connection between coal deposits and the presence of geothermal is not fully understood.

Be that as it may, the existence of geothermal reserves under coal deposits means that they are close to existing electricity grids, a distinct advantage as it solves the costly problem of getting a new form of energy from the source to the grid.

Professor Edwin van Leeuwen, scientist and former head of BHP’s Global Technology Group, is the project manager of the Victorian Geothermal Assessment Report, which is being prepared at the University of Melbourne’s Energy Research Institute.  He estimates costs of $5–6 million for drilling to see if "hot rocks" are hot enough and permeable enough to establish a reservoir. Drilling further wells for power generation will cost $10 to $15 million and, according to Van Leeuwen, setting up a plant that can maintain generation of five to six megawatts will cost $50–60 million. 

Van Leeuwen is confident that it will take only four to five years to have a plant generating 50-megawatts of power. All that’s missing is the cash.

One factor speeding geothermal’s emergence as the best alternative, baseload-delivering energy source is the relative weaknesses of its competitors. Neither solar nor wind can yet produce reliable baseload power. Nuclear is simply not viable because the massive set-up costs cannot be recovered in Australia’s small-scale market, and because of the huge time-lag involved in getting nuclear plants running here. A commission into the viability of nuclear energy in Australia set up by pro-nuclear John Howard, and headed by his old mate Ziggy Switkowski, presented its best-case scenario in 2006: 15 years to build 25 nuclear plants that could meet a third of Australia’s energy needs by 2050. And even this assessment was roundly criticised by leading scientists as optimistic and heavily biased

And unlike nuclear, geothermal has the advantage of being relatively cheap. Thanks to coal, Australia’s electricity is already the fourth cheapest in the OECD. There’s a range of conflicting figures available about the relative costs of electricity generation — but all of them suggest that geothermal is cheaper than coal, partly as a result of the fact that geothermal has no ongoing costs. In a report released by investment bank HSBC in 2009, a coal-fired megawatt was priced at AU$100, as opposed to a geothermal megawatt hour, priced at AU$70. A study by the Australian Academy of Technological Sciences and Engineering, called "The Hidden Costs of Electricity", calculated the costs of energy production factoring in wider costs, like costs to health, climate and crops. Their findings placed geothermal very favourably against coal — although they don’t offer a figure per megawatt hour for geothermal.

So if all this is true, why have we heard so little about geothermal? If it’s a solution to the clean energy crisis, why hasn’t industry development been accelerated before now? Is it a victim of coal industry resistance — or a PR failure? Or might it have something to do with the fact that there are now more lobbyists than credible climate change scientists doing the rounds in Canberra?

Geothermal certainly sounds like it presents a powerful alternative to coal-fired electricity generation. Admittedly, much of the research available about its application in Australia has been produced by the industry itself, and it remains to be seen how the technologies will function on a larger scale than the proposed test plants. But they’re putting their money where their mouth is. The Australian Geothermal Association is hosting a three-day conference in Brisbane, starting today and I’ll be trying to nail down some answers to these questions. This article is the first of a two-part series; the second will report on how the industry plans to establish geothermal as the number one alternative to coal in Australia.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.