[The Vector] Let's Talk Geothermal: Industry Stats and Jobs

Geothermal energy is a renewable, plentiful, clean and essentially limitless source of energy that can use a variety of applications. Geothermal is defined simply as heat from the earth. It tends to get less attention than wind, solar, and biofuels, but one myth the Geothermal Energy Association (GEA) says floats around – that the industry is experimental and technologies not widely used – is simply not true.

Geothermal goes as far back as the Paleo-Indian, who first used thermal hot springs. Such district-wide heating projects have been in continuous use since 1892, such as in Boise, Idaho and in Oregon. In 1904, Italy opened the first large-scale geothermal electric plant and it is still operating today. The first U.S. geothermal plant opened at The Geysers in California in 1960, and produces 11 MW of net power, continuing operations today as well. Geothermal power is used in 21 countries. The Philippines derives 27% of its electricity from geothermal sources and little El Salvador gets 26% of its electricity generation from geothermal. However, what is in use today – about 10,715 MW installed — is but a fraction that could be used, and the industry has nowhere to go but up.

The map shown here is courtesy of the GEA (Geothermal Energy Association), showing heat at a 6 km depth in the U.S.

Four recent reports covering the geothermal industry are now out and bear review:

1)     GEA Green Jobs Through Geothermal Energy Report (October 2010),
2)     GEA International Market Update (May 2010), and
3)     ABS Geothermal Energy Report 2010 (October 2010)
4)     GEA Geothermal Industry, US Market Update (October 2010)

Let’s look at some important facts from these reports:
First, let’s take a global snapshot. The number of countries producing geothermal power and the total power capacity under development is increasing significantly. In 2005, there were 8,933 MW of installed power capacity in 24 countries generating 55,709 GW of power. By early 2010, 10,715 MW is online generating 67,246 GW, which is a 20% growth in less than 5 years. Projections from the International Geothermal Association are that by 2016, at least 18,500 MW will be online, and another 46 countries are considering geothermal development.  The ABS report numbers are close to this but a bit more optimistic, projecting that the geothermal market will grow by 78% to 19,016 MW by 2015.

The greatest increase in capacity between 2005 and 2010 by country:

1) U.S. – 530 MW
2) Indonesia – 400 MW
3) Iceland – 373 MW
4) New Zealand – 193 MW
5) Turkey – 62 MW.

The greatest increase in percentage increase of geothermal between 2005 and 2010:

1) Germany – 2,774%
2) Papua-New Guinea – 833%
3) Australia – 633%
4) Turkey – 308%
5) Iceland – 184%

How do countries stack up worldwide in the category of installed capacity?  The U.S. leads the top ten:

U.S.                 3,086 MW
Philippines     1,904 MW
Indonesia       1,197 MW
Mexico              958 MW
Italy                    845 MW
New Zealand   628 MW
Iceland              575 MW
Japan               536 MW
El Salvador     204 MW
Kenya               167 MW

Europe and Africa are the two regions where development is growing most rapidly, reveals the International Market report. In 2007, 10 European countries were developing projects and this has more than doubled to 24. Six African countries were developing projects in 2007, and 11 are now doing do. Some of this is attributed to ARGeo and European Bank for Reconstruction and Development’s geothermal initiatives.

The GEA International Market Update report finds that national and international policy and financial support are key in geothermal development, and the trend is now positive for this clean energy, after a slowdown in the 1990s. For instance, ARGeo (African Rift Geothermal Energy Development Facility) underwrites drilling risks in six African nations and is backed by the World Bank and others. This has helped get African projects going and on track. Kenya hopes to be producing 490 MW by 2012 and has a goal of 4,000 MW from geothermal in 20 years.

Another factor helping countries new to geothermal is that more experienced countries such as the U.S., Australia, Japan and Iceland are facilitating geothermal projects worldwide, which may include technology sharing, training in renewable energy, geological surveys, etc. in addition to financing. Many European countries have policies such as feed-on tariffs which can make higher cost projects more feasible and help new development along.

Indonesia’s “National Energy Blueprint” — yes, even Indonesia has an energy plan, while the U.S. does not – set a goal of 9,500 MW from geothermal production, an 800% increase in the coming years. Geothermal is definitely getting attention, and the industry is growing.

Another trend noticed by the International report is that villages and tribes are looking to geothermal to become more energy independent. This includes any number of Indian tribes and reservations in the U.S. to villages in New Zealand, the Philippines, Africa and Australia.

Let’s look more closely at the U.S.

In the U.S., 77 power plants brought the installed capacity to 3,086 MW by the end of 2009.  Significant development is occurring in the western states, and geothermal developers brought approximately 176 MW of electricity on line in 2009.  Projects are in development today in Alaska, Arizona, California, Colorado, Hawaii, Idaho, Louisiana, Mississippi, Nevada, New Mexico, Oregon, Texas, Utah, Washington, and Wyoming.

The two leading states are Nevada with 68 projects in development and California with 29. The U.S. Market Update report estimates that 500 MW to 700 MW of geothermal projects will enter advanced phases between 2010 and 2011, and that the greater number will be in California and Nevada. Strong state policies and geothermal friendly regulatory structure in those two states supports this, while federal tax incentives and stimulus funding can help drive the industry.  In fact, less than 50% of the geothermal projects receiving stimulus funds are yet complete.      More on geothermal in our next article.