Critical Times

By Renfrey Clarke

“One hundred percent renewable electricity generation in Australia by 2020!” That was the bold call, endorsed by representatives of more than 100 climate action groups, that went out from the national Climate Summit held in Canberra in February.

By and large, the established media have ignored this summons – or else, dismissed it as green wish-dreaming. Renewable energy sources, the mainstream press generally has it, are incapable of replacing fossil fuels, especially coal, in providing the 24-hours-a-day “base-load” power that is the bedrock of electricity supply systems.

Not only that, the argument continues, but renewable energy is still too high-priced – more than $70 per megawatt-hour for wind power, currently the cheapest, compared with about $45 for natural gas and $35 for black coal.

Rarely, the commentaries have acknowledged that geothermal energy also provides constant, day-and-night power. But the technology needed to generate electricity from most of Australia’s geothermal resource, we are told, is unproven, and the geothermal fields themselves too remote to be exploited in the near term.
Coal, the message goes, is not to be dispensed with.

Unproven Technology?
These arguments are half-true at most. When dispersed over thousands of kilometres, wind farms are perfectly able to supply base-load power. Australia’s main sources of geothermal energy are, indeed, distant from the electrical grid, but others lie beneath existing high-tension power lines. The “hot dry rock” (HDR) technology needed to extract most of the country’s geothermal resource is indeed new. But it is well past the experimental stage; elsewhere in the world, pilot plants have been using it successfully for years.

In any case, Australia has now been shown to have substantial resources of conventional “hot wet rock” geothermal energy, conveniently sited in western Victoria and south-eastern South Australia. The technology for conventional geothermal is fully mature.

As for the costs… conventional geothermal is among the cheapest of all energy sources, fossil or renewable. Firms working on HDR geothermal, meanwhile, present modelling to show that when their projects are extensively developed, the costs of the electricity produced should be about the same as for gas-fired base-load plants.

So why the tepid response to geothermal energy? Might it have something to do with the immense political clout of the coal industry, fearful of a clean, low-cost competitor?

In terms of its exploitable resource, Australia is the Saudi Arabia of geothermal energy. Underlying the Eromanga Basin in south-west Queensland and north-eastern South Australia, at depths of four to five kilometres, are thick beds of granite as much as a thousand square kilometres in extent. Above the granite lie sedimentary rocks, which in the Cooper Basin sub-section are host to Australia’s main onshore oil and gas fields.

Decades ago, drillers for oil and gas in the Cooper Basin noted astonishing temperatures at the bottom of their holes. As radioactive elements in the underlying granite decayed and released heat, the kilometres of porous sedimentary rock further up were acting as an insulator, allowing temperatures to build up. The highest temperature so far inferred is 287ºC at 5000 metres.

Extracting Heat
Could this heat be extracted, geologists and engineers wondered, by injecting water and using the resulting steam to produce electricity? Deep granites are virtually impermeable, but oil drillers are well used to “fracturing” rocks – injecting high-pressure water to open fissures and pores so that fluids can pass through. If this could be done to the granites, the way would be open to establishing an underground heat exchanger, with water circulating in a closed loop between injection wells, producer wells located kilometres away, and a power plant on the surface.

This concept has now been proven at several places in Europe. On July 19 last year New Scientist reported: “The first 1.5 megawatt power station at Europe’s experimental [HDR geothermal] plant in Soultz, France, will soon begin operating continuously, and a second 3 MW … power station in Landau, Germany, is already selling electricity…. ”
Now that HDR geothermal has been shown to work, what are the prospects in Australia? The April-June 2008 issue of ReNew cited a study, “using conservative assumptions” , which indicated that potential reserves of geothermal energy available for electricity generation in this country came to “23 million petajoules… or 7500 years of Australian energy consumption at the current level.” Over 80 per cent of this resource was reported to be in the Eromanga Basin.

Just one of the Eromanga prospects, now being developed by the firm Geodynamics near Innamincka in the South Australian section of the Cooper Basin, has been rated as equivalent to 20 Snowy Mountains schemes in terms of its potential annual energy output. Geodynamics speaks of eventually constructing 10,000 megawatts of generating capacity on its Innamincka tenements. This would correspond to about 20 per cent of Australia’s current generating capacity, or about half of base-load demand.
As of February, flow testing had been completed successfully between the first two operational wells of the Geodynamics project. A one-megawatt demonstration power plant is due to begin generating electricity by the end of April, and a 50MW plant has been projected for 2011.

Falling Costs
Naturally, there are hurdles still to be crossed. In theory, cost should not be one of them; modelling performed for Geodynamics in 2005 suggested that a 300MW geothermal plant at the firm’s Cooper Basin field could produce electricity at a cost of $40 per megawatt-hour. Upscaling to 1000 MW, it was surmised, might undercut coal.

The economics of geothermal energy will benefit from falls in drilling costs, which are declining in real terms by about 1.5 per cent per year. In 2008 a report prepared by consultants McLennan Magasanik Associates for the exploration company Petratherm forecast that by 2050 the levelised cost of geothermal electricity would fall to about $32 per megawatt-hour, compared with $55 for “nuclear new design” and $58 for an advanced coal-fired plant with carbon capture and storage.

But the main costs of geothermal energy, unlike coal power, have all to be paid up front, meaning that suitable financing is critical. Nor are these start-up costs small. A 300MW generating plant, Geodynamics projects, would require 37 wells on an area of 7 square kilometres. Such wells cost between $10 million and $15 million each. At a time when banks are refusing to lend even to each other, private financial institutions are not lining up to fund geothermal energy.

Then there is the need for transmission infrastructure. The Geodynamics site near Innamincka is some 490 km from the nearest grid connection. New high-voltage transmission lines cost between $1 million and $2 million per kilometre.

Meanwhile, the logistics of drilling the hundreds of wells needed for really big geothermal developments are challenging, with potential for major bottlenecks. At last report there were only two rigs in Australia designed specifically for drilling onshore to depths of 5000 metres and beyond. These machines have to be imported at a cost of more than $30 million each, with orders placed many months in advance.

None of these problems is insurmountable. The underground heat is there – as much of it, effectively, as Australian capitalism cares to extract. Can the system summon the will and environmental scruple to go hard at the task, replacing coal-fired base-load power with geothermal in not much more than a decade?

A Strategy for Geothermal
Before pronouncing on this question, we need to map out a general strategy for coming up with at least 20,000 megawatts of geothermal power at an accelerated pace.

A crucial need is for drilling equipment. Purchasing licenses where necessary, but also mounting a big research and development effort, Australian industry needs to come up with world’s-best rigs and other technology for drilling into deep granites. Then it has to put this equipment into series production on a large scale.

There will be little danger of saturating the market for this technology. HDR borefields have a life of 20-30 years before they must be retired for 50-100 years to allow the heat to build up again; therefore, the need for new drilling is more or less continuous. Furthermore, Australia is not the only country with geothermal resources. For the world’s leading producer of specialist HDR geothermal technology, there would be lucrative export sales.
Then there is the need for transmission infrastructure. Last year, Geodynamics was reportedly lobbying for the construction of a “transmission superhighway” linking Adelaide and Brisbane, with its hub in the geothermal fields of the Eromanga Basin. The concept is a valid one. Ideally, the line would make use of high-voltage direct current technology that loses only about 3 per cent of current per thousand kilometres.

On its way north from Adelaide, the line would connect up promising geothermal fields at Paralana and Callabonna, to the east of the North Flinders Ranges. Petratherm is soon to begin deep drilling at Paralana, where a generating plant of Snowy Mountains-scale annual output is projected.

As specialised drilling equipment became available, HDR geothermal exploration work would be stepped up, largely in the Eromanga basin but also at sites close to existing power lines. At one such prospect, north of Port Augusta, temperatures have been inferred of 240ºC at 5000 metres.
Much of the early geothermal development, however, would be “conventional” in nature, tapping hot water in sedimentary basins. Resources of this kind are known to exist beneath wide areas of western Victoria, as well as in South Australia near Renmark and Penola and on the Limestone Coast. The Limestone Coast prospects are described by the tenement holders as having “an estimated generating potential of approximately 1500 MW… enough power for more than one million homes.” A 4.5 MW demonstration plant is planned for late in 2011.

In western Victoria, the Age related on January 10, “vast aquifers of ancient brackish water heated up to 145 degrees” lie beneath sedimentary rock at depths between 2.4 kilometres and more than four kilometres. Just one of the exploration firms involved “believes there is enough geothermal power available within its tenements to generate up to 5000 megawatts, or almost Victoria’s entire electricity requirement. ” At these relatively shallow depths, highly specialised drilling equipment would not be necessary.

Renewables and Capitalism
Could a concerted push to develop geothermal energy provide the base-load power needed to substitute for coal-fired generating by 2020? Much of the necessary engineering capacity could be freed up if Australia’s “defence” complex were converted to useful production.
As for the on-site development… if Australia were suddenly found to be a Saudi Arabia of oil rather than of geothermal energy, would the money, equipment and skilled workers be found to rush the newly-discovered oilfields, however remote, into production within a few years? The question answers itself.

Oil, of course, is in relative shortage, commanding handsome prices and good profits even during a recession. Meanwhile, cheap coal means that Australia already has plenty of electricity, much of it at prices HDR geothermal would not quickly match.

To wholeheartedly embrace geothermal power, Australian capitalism would need a profit signal pointing unmistakeably toward producing and using renewable energy. The signal at present is very different. Switching to renewables would mean junking coal-fired generating assets worth billions of dollars, while these assets were still bringing good returns. The effect would be to raise costs and cut profits across broad areas of Australian business.

That is not to say that coal should remain king, or that switching to renewables should not be an urgent national priority. What it does show is that capitalism, with its tunnel-vision concentration on private profit, is not the system to bring about the changes needed to avert civilisation- ending environmental catastrophe.