Geothermal energy is Iceland’s second-largest source of power, while in New Zealand it provides 7% of the country’s electricity.
New Zealand’s first geothermal plant, at Wairakei, was commissioned in 1958 and has been a consistent and reliable producer, with average annual generation being the equivalent of 1250 gigawatts per hour and a load factor of 93%. Present output is equivalent to 140MW. At least 150 wells have now been drilled in the field.
The circumstances that prompted the government to commission the first generator at Wairakei – low hydroelectricity lake levels and a desire for electricity supply to be independent of imported fuel – still apply in 2006.
Rotorua geologist Ashley Cole late last year claimed geothermal power could ultimately provide up to a third of New Zealand’s electricity needs, and with the country’s energy demands growing rapidly, major power players are considering expanding their geothermal generation.
There are currently about 250 conventional geothermal electricity plants worldwide producing a total 8900MW, but none of these are in Australia. Privately held Scopenergy aims to set up Australia’s first such facility.
While Australia’s geology is very different from that of New Zealand, Scopenergy believes there are parts of South Australia that can be drilled to tap into existing underground heat exchangers.
Late last year, the company was granted a $A3.98 million Federal Government grant from AusIndustry for a proof-of-concept project in the Limestone Coast region of South Australia’s Otway Basin, which is intended to lead to a 50MW power plant.
“The project will better define prospects for more than 1000MW of geothermal power in the region,” AusIndustry said.
If successful, it will lead to an estimated greenhouse gas abatement of almost 40 million tonnes of carbon dioxide, according to Scopenergy managing director Roger Massy-Greene.
Conventional geothermal power has been proven to be capable of delivering reliable and renewable baseload energy with no emissions and a low environmental impact. Unlike wind, solar and hydro generation, it is unaffected by weather.
“Conventional geothermal power is derived from naturally occurring sources of hot water in naturally permeable geological formations,” Massy-Greene said.
“The station will use water from 4km deep, and return all of the water to the reservoir after extracting the heat. There won’t be any emissions of anything to the atmosphere and the station won’t disturb its neighbours.
“Approval of the grant is an important milestone. The project has the potential to produce electricity at a cost that is comparable with conventional sources, but this grant is important because it helps finance 3D seismic and drilling that are critical to proof of concept.”
Scopenergy last year signed a deal to supply Snowy Hydro with 40MW of electricity from its future Limestone Coast conventional geothermal project in south-east South Australia. It expects to deliver into the contract from January 2009 until it terminates in 2020.
“The company’s aim is to be generating 50MW by 2009 and thereafter to expand its generating capacity to 250MW in the medium-term,” Massy-Greene said.
However, the construction of the stage one $160 million 50MW power station still depends on whether Scopenergy’s reservoir-proving program is successful.
The company has secured 2634 square kilometres of geothermal exploration licences in the Limestone Coast region. It claims this is Australia’s most prospective region for conventional geothermal power.
“Initial estimates by the world’s largest geothermal consultancy, US-based GeothermEx, indicate the generating potential of these leases at more than 1500MW,” the company said.
Scopenergy said the large conventional geothermal resources in this area were analogous to resources in California that had been in production for 20 years.
In New Zealand, two players dominating the geothermal power generation scene – NZX-listed Contact Energy and government-owned Mighty River Power – are more circumspect than Cole, they both see great potential for this renewable energy source.
“I think geothermal is a story which hasn’t really been told yet. I really think it is the ultimate renewable generation,” Contact spokesperson Jonathan Hill told EnergyReview.net.
“We believe there is potential for significant new geothermal generation.”
MRP is undertaking a hundred-million-dollar geothermal exploration program, the largest in New Zealand for many decades.
“Mighty River Power has invested significantly in developing its geothermal capabilities and has over 30 people in its geothermal team,” MRP spokesperson Neil Williams said.
“We expect to continue growing our capabilities and investments.”
However, both companies said future investments in geothermal would depend on the economics relative to other generation alternatives, transmission access, resource access, permitting and other environmental issues.
New Zealand’s present geothermal activity is centred largely in and around the central North Island’s Volcanic Plateau and provides about 7%, or 450MW, of the country’s total electricity generation capacity. Six major fields are currently used for geothermal electricity generation.
Contact has operated geothermal plants in the greater Taupo region for many years and can now generate over 300MW from its three plants at Wairakei, Poihipi Road and Ohaaki.
It is also undertaking some exploratory drilling at the Wairakei and Tauhara Fields to determine their resource potential.
With domestic gas resources declining, Contact also supplies geothermal heat directly to industrial-agricultural users, an approach that could facilitate the retention of businesses and employment in the central North Island.
MRP has a 25% shareholding in and operates the 96MW Mokai geothermal power station near Taupo for the 75% owner, the Tuaropaki Power Company, a wholly owned subsidiary of the Maori Tuaropaki Trust.
MRP also owns the 34MW Rotokawa plant, also near Taupo, and has plans to possibly double Rotokawa’s capacity. The company is also involved in exploratory drilling at nearby Mangakino to determine whether a station there would be viable.
In addition, it is considering constructing a new 70-80MW geothermal station at Kawerau.
Williams says MRP sees scope for a total of approximately 400MW of additional geothermal development, by all the players involved in the industry, over the next 10 years.
