Geothermal industry sees modest, sustained growth


Geothermal energy development grew 5 percent in the U.S. since March 2012, a number analysts say points to a continued desire for geothermal and renewable energy sources.

The 2013 Annual US Geothermal Power Production and Development Report shows that total growth was just over 147 MW coming from seven individual projects. The Geothermal Energy Association estimates U.S. geothermal generation capacity at 3,386 MW. California continues to lead the nation, having increased its capacity to 2,732 over the past year.

While 5 percent is nowhere near the grow levels seen by solar and wind energy, geothermal is not down for the count.

 "The policies and technologies are there to help move things forward," said Karl Gawell, GEA executive director, during a Tuesday briefing. "Our industry is, and always has been, ahead of the curve when it comes to technological advancements," Gawell said.

Analysts noted that one reason for the modest growth is the fact that geothermal doesn't have the notoriety of other renewable energy sources. Much of that can be attributed to a lack of exposure to and understanding of the technologies and processes involved, said Tom Williams, a program manager at the National Renewable Energy Laboratory.

Further, geothermal projects tend to range between 10 and 50 MW, which is markedly smaller than typical utility-scale generation projects. The largest project to come online last year was 49.9 MW, according to US Geothermal.

Expanding the geothermal industry is going to depend on financing, though it's uncertain exactly where this will come from. Federal tax credits for geothermal will expire at the end of 2013. All generation projects under construction by that date will be eligible to receive the credit once operational, though it remains unclear as to how "under construction" will be interpreted. Once that credit is complete, Washington is unlikely to provide additional relief, at least in the near term.

Outside of government, capital markets remain tight and equity is hard to acquire. With that in mind, sustained a commitment by utilities through power purchase agreements (PPAs) and financial support will be a big ally to geothermal development.

"Industry needs consistent and sustained research support to develop new technology, reduce risk and spur technological innovation. State renewable standards need to recognize the full benefits of geothermal power to their power system reliability and the environment," Gawell said, in his comments.  

Going forward, the geothermal industry is looking for new ways to expand its footprint. This includes working with commercial retailers and data storage companies to provide on-site generation, and continuing to support development across the United States.

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