Geothermal energy could supply as much as 5 percent of Australia's electricity requirements by 2020 with an investment of about A$12 billion ($10.4 billion), helping reduce greenhouse gas emissions, an industry group said.
Producing power from underground heat could provide a maximum of 2,200 megawatts of continuous generating capacity by 2020, the Australian Geothermal Energy Association said today in an e-mailed statement, citing a study by economic modeling firm McLennan Magasanik Associates. That would be up to 40 percent of the nation's 2020 target for renewable energy use.
Geodynamics Ltd. and Petratherm Ltd. are among companies seeking to tap super-hot granites lying as deep as 5 kilometers (3.1 miles) underground in South Australia state to produce low- emissions electricity. Twenty-three companies will invest more than A$701 million in geothermal exploration in the state in 2002-2013, the South Australian government said this month.
“This report highlights that the Australian geothermal energy industry has a potentially significant contribution to solving Australia's long-term climate change challenges,'' Gerry Grove White, chairman of the group, said in the statement.
The cost of generating power from geothermal sources is expected to decline to become the cheapest form of renewable energy by 2020, the study found. The report was released today at a conference in Melbourne. The government has a target to get 45,000 gigawatt-hours of electricity from renewable sources by 2020.
Government Funds
Australia could have its first commercially viable geothermal power plants within four to five years, Resources and Energy Minister Martin Ferguson said today in a separate e- mailed statement. He announced at the conference a A$50 million program to provide grants of as much as A$7 million to help finance the drilling of deep geothermal wells and early-stage, proof-of-concept projects.
Australia's geothermal resources are different from conventional ones in that they are in the form of deep hot rocks rather than shallow volcanic systems. That means they require deeper wells and the injection of fluids to bring the heat to the surface for power generation.
The Australian government is set to enter a partnership with the U.S. and Iceland for the sharing of information on geothermal energy technology, Ferguson said in e-mailed notes for a speech given today at the conference.
Origin Energy Ltd., Australia's second-biggest electricity and gas retailer, Woodside Petroleum Ltd., Beach Petroleum Ltd. and CLP Holdings Ltd.'s TRUenergy Pty unit are among companies backing geothermal energy ventures in Australia.
