Geothermal energy: Up for a new push

The first technology is known as “Enhanced Geothermal Systems” (EGS). It relies on “enhancing” or “fracking” reservoirs by creating artificial cracks, e.g., by applying pressure or injection of cold water, sand, or acidic fluids (Figure 2). This method improves the yield of new and existing projects and allows geothermal energy in places that have historically not been able to host geothermal systems due to insufficient quantities of underground water. However, project risks in EGS still exist, as it remains difficult to predict how permeable reservoirs can be made by enhancement. More importantly, reservoir enhancement can release geological pressure underground and potentially even trigger earthquakes. Even though the triggered earthquakes may prevent larger, natural earthquakes, it is understandable that many residents oppose EGS projects in their neighborhoods, as there is some remaining risk in seismically active regions. Failed experimental projects in the past and the poor handling of damages, even though damages were minor, if any, have led to local opposition to projects. Therefore, experts think that EGS is a promising technology for seismically inactive or sparsely populated areas for the foreseeable future.

The second existing technology is called “Closed-loop Geothermal Systems”, also known as “advanced geothermal systems (AGS)” or “hot dry rock”. Closed-loop systems are based on drilled heat exchangers and do not rely on naturally occurring, water-filled fractures in the underground (Figure 2). The wells are fully sealed, and there is no direct contact of the heated fluid with the rock, differentiating closed-loop from hydrothermal and EGS. Consequently, the challenges of other geothermal systems, like variance in water temperature, fluid yield, and problems with dissolved materials, are eliminated. Project risk and complexity are reduced. Eventually, projects would be more similar to each other, likely enabling faster technological learning-by-doing. Furthermore, projects could be built almost anywhere in the world, which highlights the radical potential of closed-loop systems.

Despite this promise, the challenges for closed-loop systems to become economically competitive are twofold: first, the drilled distance required per project is roughly ten times higher than for EGS, and, second, the complicated technology required to drill and stabilize complex well geometries deep underground. However, recent results from a closed-loop project in Germany seem promising. In sum, closed-loop technology is the most challenging and costly today but has the highest potential to scale rapidly and globally.

In addition to EGS and closed-loop, several other geothermal technologies are in their research or demonstration phases. These include using reservoirs for energy storage by building up pressure underground, coupling geothermal energy and carbon storage, co-extracting lithium from the geothermal reservoir, and tapping “super hot” reservoirs. However, these ideas still need more development or remain limited in their geographical applicability as of today.

Increased interest, technological progress, and recent successes lead to optimism

Independent of technology, a renewed interest in geothermal energy can increase deployment to drive down project costs. The reasons behind the increased interest in geothermal energy are the increasing awareness that a fully decarbonized economy requires firm electricity and renewable heat, governmental mandates to set out plans for this, and the heightened consumer fear of future fossil fuel price shocks following the gas crisis of 2022. Recent successes lead to optimism. For example, around the city of Munich, more than 20 geothermal projects are now operating successfully. The increased interest in renewable heat led developers to build a project with three times the usual power output, enabling significant scale effects and lower project costs.

It’s a co-benefit to transfer knowledge and workers from the fossil industry to renewables

Not surprisingly, many of the mentioned geothermal technologies come from the oil and gas industry, including measuring equipment, drilling rigs, valves, and pumps. EGS and closed-loop systems are based on technologies developed during the last two decades’ shale oil and gas boom. Many geothermal startups have been founded by experts formerly employed by the fossil industry, and the fossil industry itself is currently financing some of the new geothermal projects. Some argue that geothermal energy should not be used as it benefits the fossil industry. However, I believe that we should welcome any company that propels renewable energy. Allowing fossil fuel companies to carry out geothermal research would support technology development – a positive outcome for furthering renewable energy! The companies and their employees hold valuable knowledge to make the energy transition happen. Drawing on existing knowledge and giving new jobs to former oil and gas employees, in my view, kills two birds with one stone, circumventing unemployment and political opposition before it even emerges. 

Increased interest, technological progress, and recent successes lead to optimism

In conclusion, renewed interest and new technologies can enable an accelerated rollout of geothermal energy. However, current technology requires projects to be individually adapted to local geographies. New technologies, namely enhanced and closed-loop geothermal systems, can enable geothermal energy in more locations, at a higher buildout rate, and potentially with lower costs. Fast learning and deployment in geothermal energy are critical and urgently needed for a fully decarbonized world.