Old 04-20-2009, 06:31 AM
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Default Spare a Dollar for Geothermal

Spare a dollar by by Keith Orchison
Some proponents of alternative energy must have been biting their lips over last week’s fuss about international cooperation on coal emissions capture and burial – and the Rudd government’s $100 million extra contribution to support it.

One such would be the geothermal developers.

As the Australian Geothermal Energy Association chief executive Susan Jeanes explained to the Senate Economics Committee late last month, between 1,000 and 2,200 MW of baseload, zero-emission hot rock energy could be brought on stream between now and 2020 – at a cost of about $90 per MWh – if the industry could persuade the government to come good with financial support.

Jeanes estimated the cost of getting geothermal operations to commercialisation stage at between $250 million and $350 million apiece and said the industry believed it had to get up three or four such demo projects to demonstrate to the investment community that it was worth substantial support.

In turn, she said, the industry needed between $70 million and $100 million per project in government support.

“We do not want a lot of money in perpetuity,” she told senators. “We want enough in the early years to demonstrate that geothermal energy works reliably at large scale.”

This required, she suggested, either continuation of the Low Emissions Technology Demonstration Fund, a Howard government creation, or use of the Renewable Energy Demonstration Program.

Jeanes said some $435 million in renewable energy support funds were kicking around in the government system, but no geothermal projects had been funded so far.

Developers were waiting at present for an announcement from the Department of Resources & Energy about allocation of $50 million to support geothermal drilling – a sum that won’t go very far because each deep well costs about $15 million.

In answer to a Dorothy Dixer from fellow-South Australian Nick Xenephon, Jeanes agreed that geothermal was an industry “raring to go” but so far had not received the degree of support needed to kick-start projects.

She added that one of the geothermal sector’s big concerns was that, by the time it was ready to “deliver large chunks of power,” most of the incentives to the renewable energy sector from the Rudd RET scheme would have been snaffled by existing technology such as wind farms.
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geothermal, hot rock energy

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