Geothermal is increasingly cost-competitive with wind and solar power and can work together with them to create a reliable supply of renewable energy, according to Francesco La Camera, who sees geothermal capacity growing up to eight-fold in the EU by mid-century.
Francesco La Camera is director general at the International Renewable Energy (IRENA) based in Abu Dhabi.
Some energy companies say new deep drilling techniques today allow geothermal to be deployed on 70% of the world’s territory. Does that match with your projections?
I cannot confirm 70%, 75% or 65%. What I can say is that geothermal energy is not restricted to a specific place and can be found in different geological and geographical settings around the world.
Our assessment concludes that geothermal can be utilised for various applications in different parts of the world to the benefit of the local populations. We have many volcanic areas, Iceland for example, but also the United States, Indonesia, East Africa and many others where geothermal is already exploited.
And there are other technologies emerging, creating artificial geothermal reservoirs. The geothermal industry is working on Enhance Geothermal Systems for example in France and South Korea. This could increase the world-wide capacity to create artificial geothermal that may widen the use of geothermal.
More recently, we have also seen a growing interest in using geothermal resources for heating and cooling. Using easily accessible geothermal resources found in shallow ground, at depths less than 400 metres, will certainly increase the use of geothermal resources for heating and cooling almost everywhere.
What are your own projections for geothermal plants, particularly in Europe, and how much can they expand?
We have made our projection in our Global Renewables Outlook, where we assessed the potential and developmental to produce electricity and energy.
Our projection shows that in Europe the geothermal energy capacity can grow eight-fold by mid-century. The same goes for the rest of the world, where we may see a 12-fold increase of geothermal by 2050 compared to today’s capacity.
What is the cost reduction potential on an industrial scale worldwide now?
The most important factor is the cost-competitiveness of geothermal. And it is, increasingly competitive.
Going further, additional incentives have to be set in place. In particular as geothermal, mainly in the exploration phase, is very expensive. It’s crucial that all the risk and the cost of the first phase are taken into account by policy-makers to make geothermal more attractive.
Geothermal can also be important in the context of a holistic energy system because it can provide the base load power that may balance variable renewable energy like sun and wind. Geothermal could be one way to increase flexibility in the energy system.
The deployment of geothermal in the agri-food sector and in district heating and cooling still needs to be promoted. Risk mitigation tools provided by the international financial institution may help, for example, the Geothermal Resource Risk Mitigation Schemes by the World Bank.
Do you think geothermal installation costs can decrease over the coming years as more technology becomes available?
Geothermal doesn’t compete but complements other renewable sources like sun and wind. As cost-competitive source, geothermal can complement other renewables, providing the necessary balance and degree of stability in the power networks.
We also consider that geothermal is important in the energy sector overall, for buildings, cities and agriculture. Geothermal energy can reduce pollution, it reduces waste and promotes food security. Equally important is a right policy framework to support geothermal development to make our system cleaner, and more resilient.
Wind and solar are actively supported in the EU’s renewable energy directive. How can geothermal actually get into the EU market if it doesn’t enjoy similar backing?
There is not really a problem in terms of competitiveness. Geothermal is absolutely comparable with any other possible way to produce energy.
The main issue that I see is related to the exploration phase where the costs and risks may be too high. Inadequate financing at the beginning is one of the barriers that we have to overcome if we were to develop geothermal activities further.
In this respect, I think that geothermal risk mitigation schemes for example in France, Germany, Iceland, Netherlands, Denmark or Switzerland can be considered as possible guidance.
Within Europe, what subsidies are needed and how can geothermal attract those in order to boost its presence in the market?
We are talking about lowering the cost in the initial phase and lowering the risk of the investment. We are not talking about subsidies on kilowatts produced.
Our data suggests that over the next couple of years the global average costs could fall to just over five cents per kilowatt hour.
So overall geothermal is increasingly cost-competitive. To get there, we have to decrease the risks and costs and promote investment during the early stages of geothermal development. In doing so, government may play a role in supporting the unleashing of geothermal around the world.
Turning to the environmental side of geothermal. It is a renewable source of energy but there are concerns about the carbon footprint when the drills use diesel. How can you cut down on that carbon footprint?
While IRENA has not engaged in this area, we learn from existing studies that geothermal is a renewable energy resource with relatively low carbon footprints associated with its development and exploitation.
Also, innovative carbon capture and storage technologies for example in Iceland are being developed to ensure zero emissions from geothermal power plants.
What about issues related to water pollution?
Naturally project operators have to manage the plant. The recirculation and recycling of water during the drilling operations can minimise the water usage and prevent pollutions.
I saw it when I visited a plant in Iceland. The operator was able to produce geothermal energy without any significant environmental consequences.
Studies from the EU Commission and others also suggest that binary power plant technologies can even ensure zero emissions if fluids are being 100% reinjected into the ground.
Looking at the future of geothermal, do you see future demand mainly for providing heat to cities or as electricity baseload?
We see a growing demand in the future. Today, geothermal energy doesn’t represent a large amount of the installed capacity, it’s less than 1% of the global energy mix.
But there is room for the development of geothermal and it could show an attractive way to provide balance and flexibility for the energy system, where variable renewables are used.
The major challenge we face is decarbonising the energy sector. This includes buildings and cities alike. Geothermal provides a compelling solution for heating and cooling, and there are many cities that have been doing so for example in China and Eastern Europe.
So, from an energy and power point of view geothermal will play a significant role in the future.
[Edited by Frédéric Simon]