geothermals

CAMERON ENGLAND
July 17, 2007 02:15am
A GEOTHERMAL energy lobby group believes its renewable "hot rocks" power could compete with coal regardless of a carbon tax being introduced.
The Australian Geothermal Energy Group's submission to a Federal Government inquiry into non-fossil-fuel development says power derived from hot rocks deep under the Australian Outback could be comparable in cost to coal-generated power within decades. Coal-generated power is now the cheapest form but is also the most polluting.
Geothermal energy involves pumping water into wells 4km to 5km deep in hot subterannean granites, then harnessing the heat energy which returns to the surface as heated water.
The process, still in development, is virtually emissions free.
"Many forms of conventional energy generation such as coal and natural gas are currently more cost-effective than any renewable energy sources," the submission says.
"However, modelling undertaken by McLennan Magasanik Associates concludes electricity generated from hot-rock-enhanced geothermal systems will be lower-cost than any other form of renewable energy and, within decades, has the potential to compare in cost to coal-fired power without pricing of greenhouse gas emissions factored into the cost of generation."
Most of the geothermal energy exploration in Australia is focused on South Australia, which has attracted more than 80 per cent of exploration licence applications and investment.
"The rate of exploration spending is expected to increase rapidly this year," the report says.
"In 2006, the total (estimated) $29 million spent on surveys and well operations in geothermal licences in Australia targeted geothermal resources in South Australia.
"This represents an 11 per cent increase ($3 million) from the previous year. A 97 per cent increase (to $45 million) is forecast for 2007 and 96 per cent of this is associated with geothermal licences in SA."
The first generation of geothermal projects is expected to produce energy at between $70 and $130 per megawatt hour, falling to $60-$100 as the industry matures. While coal and gas generation costs are generally cheaper, Department of Primary Industries and Resources director of petroleum and geothermal Barry Goldstein said studies had shown they were expected to increase faster than inflation over future years to the point where geothermal became competitive.
Mr Goldstein said this was expected to happen at about 2040.
According to the report, the Federal Government so far has allocated grants totalling $27 million and the SA Government $1.3 million in grants for geothermal exploration and proof-of-concept projects.
The AGEG represents 46 groups, including geothermal-energy companies, state and federal government representatives and universities. SA companies Geothermal Resources and Petratherm are both involved.