Geothermal energy

Learn what geothermal energy is, how it’s used today, and what opportunities it offers for the future.

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What is geothermal energy?

Geothermal energy harnesses the power of heat stored within the earth’s crust to produce electricity without the use of fossil fuels. Over time, the planet’s formation and the radioactive decay of materials produced (and continues to produce) heat that is currently stored in liquid, steam, and rocks underground. These materials can reach temperatures of up to 370°C and be found at depths ranging from just beneath the surface to several miles below. Once extracted, this heat is transformed into clean, renewable electricity used to power modern life.

How does geothermal energy work?

Underground pools of water are heated by magma deep within the earth. When the water reaches a certain temperature, it escapes through cracks in the earth as either water or steam and bubbles up to the surface before sinking back down (this is called a “natural hydrothermal convection system”). This steam is captured and used to power a geothermal power plant.

There are three main types of geothermal energy plants generating power today. Here’s how each of them works:

Dry Steam Power Plant

Dry steam power plants channel hot steam from underground directly into turbines that power generators that produce electricity, eliminating the need to burn fossil fuels. The first dry steam power plant was constructed in Lardarello, Italy, in the early 1900s. Today, the world's largest single source of geothermal power is a dry steam power plant located at The Geysers in northern California. These power plants emit only excess steam and very minor amounts of gases, making them one of the cleanest types of energy providers.

Flash Steam Power Plant

Flash steam power plants are the most common type of geothermal power plants. These plants extract hot water (not steam) from the earth and pump it under high pressure into a “flash tank” at the surface. The flash tank is held at an exceptionally lower temperature, which causes the fluid to rapidly vaporize or “flash” into steam. The steam then powers a turbine, which powers a generator. Once the steam cools and condenses back to water, it is returned into the ground through an injection well.

Binary Cycle Power Plant

At a binary cycle plant, water or steam from beneath the earth’s surface never comes into contact with turbines. Instead, it is pumped from the earth and used to heat a second liquid (usually one that boils at a lower temperature, like isobutane) in a heat exchanger. The steam from the second liquid is used to power turbines that drive energy generators. The hot water extracted from the earth is returned through an injection well, while the second liquid is recycled back into the heat exchanger to be used again.

Binary cycle power plants could be responsible for producing significant amounts of geothermal electricity in the future since the most common geothermal resources are below 300°F. They’re also one of the cleanest types of energy providers, as they release no emissions except for water vapor.

Emerging technologies: ESG

Accessing geothermal resources isn’t easy. First, there needs to be a natural hydrothermal convective system, where water is heated to a high enough temperature that it turns into steam. Next, the surrounding rock must be porous enough to allow the steam to bubble up to the surface and permeable enough that the energy can be extracted with existing technologies. The problem is, most of the world’s geothermal resources are located in dry, impermeable rock.

An enhanced geothermal system (EGS) is a developing technology that makes energy extraction from dry, hot rock possible by creating engineered geothermal reservoirs. Cold water is pumped thousands of feet underground, allowing engineers to access hot water and produce the steam required to power energy plants on the surface. EGS expands the geographic possibilities of geothermal energy, making it possible to tap into this resource at a larger scale.

How is geothermal energy being used today?

Geothermal energy is currently being used to heat, cool, and/or provide electricity to people in over 95 countries. The United States is leading the pack in terms of geothermal electricity generated, with geothermal power plants currently operational in seven states. These plants produce about 17 billion kilowatt-hours (kWh), equal to 0.4% of total U.S. utility-scale electricity generation. A 2019 GeoVision report commissioned by the U.S Department of Energy estimates that the country’s geothermal resources could provide 5,157 gigawatts of electric capacity—around five times the nation’s current installed capacity.

Geothermal electricity generation by state

State share of total U.S. geothermal electricity generation Geothermal share of total state electricity generation
California 70.5% 6.1%
Nevada 24.5% 10.2%
Utah 2.1% 1.0%
Hawaii 1.2% 2.2%
Oregon 0.9% 0.2%
Idaho 0.5% 0.5%
New Mexico 0.3% 0.2%

Case Study: Iceland

During the 20th century, Iceland went from one of Europe’s poorest countries—dependent upon peat and imported coal for its energy—to a country with a high standard of living, where practically all stationary energy is derived from renewable resources.

How did they do it? By harnessing the power of geothermal energy pulsing beneath their feet. Reykjavik is home to the world’s largest and most sophisticated geothermal district heating system, which has used natural hot water to heat its buildings and homes since 1930. Today, geothermal energy powers the entire city through an electricity distribution network that harnesses 750 MW of thermal power from steam and a water distribution system that generates 60 million cubic meters of hot water. Geothermal energy reduced the city’s dependence on fossil fuels—and protected it from market fluctuations—while turning it into one of the cleanest cities in the world.

What is the future of geothermal energy?

Being among the safest and cleanest energy sources, geothermal is one of the most exciting energy areas to follow. And our team is keeping a close eye on a multitude of new construction projects taking place in both domestic and foreign markets.

Here’s a peek at what’s happening in the US:

The United States is positioned to expand geothermal power generation nearly 26-fold by 2050, reaching 60 gigawatts of available, base-load energy capacity. With the potential for widespread deployment, geothermal energy used for heating and cooling could help cut U.S. emissions in half by 2030 and achieve a carbon pollution-free electric sector by 2035.

Since late 2019, nine new geothermal Power Purchase Agreements have been signed across four states. These agreements include plans for the first two geothermal power plants to be built in California in a decade.

Geothermal companies operating in the U.S are currently carrying out 58 active projects across nine states. Of these projects, five are in Phase 4—the last phase before project completion. Three of these projects are in Nevada, and two are in California.

…And around the globe:

As countries around the world tap into their natural resources, geothermal is proving to hold some pretty serious potential. In trying to predict what a clean energy future looks like, some thought leaders, like the clean-tech wiz Saul Griffith, figure geothermal will eventually account for around 1/6th of the world’s power supply. Others, like the IPCC, think it will clock in at 4%. Either way, geothermal will be an integral part of the renewable energy mix, powering the world as fossil fuels recede from view.

What are the advantages and disadvantages of geothermal energy?

Geothermal energy is often referred to as the cleanest energy source, providing an economically sound, greener alternative to fossil fuel burning. However, as with any energy source, there are advantages and disadvantages to its use. We’ve rounded up some of the pros and cons for you below:

Advantages

Renewable

Energy extraction can be balanced with a reservoir's natural heat recharge rates with proper management.

Domestic

Natural geothermal resources in the U.S. can be harnessed for power production without the need to import fossil fuel.

Small Footprint

Geothermal power plants are compact. They require less land per GWh (404 m2) than coal (3642 m2), wind (1335 m2), or solar PV with center station (3237 m2).

Constant, cheaper energy

Geothermal power plants are capable of producing electricity consistently (24/7) regardless of weather conditions. It’s also cheaper than conventional energy, with savings of as much as 80% compared with fossil fuels.

Clean

Modern closed-loop geothermal power plants emit no greenhouse gasses. Lifecycle greenhouse gas emissions (50 g CO2 eq/kWh) are four times less than solar PV and 6-20 times lower than natural gas. These plants also consume less water on average over the lifetime energy output than the most conventional generation technologies.

Disadvantages

Location specific

Production is limited by location to areas where geothermal. reservoirs are easily accessible.

Byproducts

Geothermal plants can release hydrogen sulfide, a gas that smells like rotten eggs. Additionally, some geothermal fluids contain small amounts of toxic materials that must be properly disposed of.

Earthquakes

Geothermal plants are often established near tectonic plate boundaries where it’s easier to access geothermal resources. Injecting water into these areas can open fissures that can lead to seismic activity. However, these areas are often not near population centers, which means the risk to human life is minimal.

High costs

Exploration of geothermal reservoirs and drilling require large capital injections at the start. A plant with a 1-megawatt capacity can cost $2-$7 million. However, a long-term return on investment that recoups these costs is promising.

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