Geothermal energy for powergen “could save the world,” but it isn’t getting enough attention, a U.S. Department of Energy (DOE) director said on March 19.

“Communication and education have been something that have been thought of as secondary … and I think that's hurt geothermal,” Lauren Boyd, DOE director, geothermal technologies office, said at CERAWeek by S&P Global.

But “we have a variety of incredible technologies that can save the world included in this bucket, this family” of energy technologies.

For those who understand it, the investment hurdle is in the subsurface risk. “Who's actually working on next-generation geothermal are the startups,” said Irlan Amir, geothermal director for energy-services firm SLB.

As for power producers, “they're looking into geothermal but they're not comfortable because the subsurface risk is too high for them,” Amir said. “They don't know [the risk assessment]. They're not comfortable. They're very good in power generation or power plant technologies.

“But the subsurface? They're not comfortable.”

Environmental risks include the potential for earthquakes and sinkholes — and steam that contains H2S and ammonia as well as elements such as mercury.

Then there’s the geologic risk, which is assessed much like in oil and gas drilling. Curtis Cook, founder and CEO of Calgary-based geothermal startup Rodatherm Energy, told Hart Energy after the CERAWeek session that subsurface risk in geothermal includes the economic life of the well.

As with oil and gas development, acreage consists of Tier 1, Tier 2 and fringe areas. While geothermal is fairly ubiquitous, some spots are sweeter than others in terms of heat intensity and the EUR of each well.

Some wells may be dry holes.

But “geothermal is and can be competitive,” Ajit Menon, vice president, geothermal, for Baker Hughes, said during the session.

The clean nature of the energy source should be considered by users, he said. “If you have a clean base load, will it have premium pricing over intermittent [power, such as wind and solar]? What’s the value to the end user?”

Menon added some states are factoring into their thinking that geothermal is essentially its own storage tank as they weigh it against wind and solar. With that additional measure, “it becomes very good” as an option, Menon said.

Well costs can be high due to cementing, Boyd said. But “if we're valuing geothermal appropriately, then it is extremely worthwhile.”

Greg Leveille, former CTO for ConocoPhillips, asked the panelists when geothermal wells will be longer and deeper than the half-mile verticals and laterals he has seen.

“When we started out in [the] Barnett [Shale], they were 3,000 feet in length. Today we're drilling 15,000 feet. The amount of production we get out of a 15,000-footer is significantly more than 3,000,” Leveille said.

Baker Hughes’ Menon said that “longer laterals are going to deliver much more performance. I think the [geothermal] players are all looking at that.”

Another advancement would be in a larger hole size, he said. “That could be a game changer.”

SLB’s Amir concurred. “That's the next step where this thing needs to go—a longer lateral with a big hole size,” he said. “I think pushing that beyond 3,000 to 5,000 to 10,000 [feet] is a goal. Absolutely.”

Another attendee asked if there may be tax breaks for geothermal dry holes, just as there are for oil and gas dry holes. The DOE’s Boyd said she isn’t aware of such incentives for geothermal.

Menon said there used to be a program. “In fact, it stimulated a lot of activity on the West Coast where dry exploration costs were subsidized. Internationally, I think Iceland is still doing that.”

Generally, he added, he’s seen that tax breaks on dry holes have incented geothermal exploration and development in the past.

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