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geothermal
If the impression given by the federal and state
energy ministers was one of cautious optimism
and long-term, rather than short or mid-term,
thinking, Kobad Bhavnagri, Bloomberg New
Energy Finance Lead Clean Energy Analyst, was
by comparison brutally candid in his assessment
of the current state of the industry in Australia.
Bhavnagri noted the outlook for the global
geothermal sector is relatively strong, with
countries in the Asia Pacific, among them
Indonesia leading the charge, offering up
promising signs. In all, Bhavnagri noted, there
are currently 273 projects being undertaken in
50 countries around the world, but with only
16%, 1.9 GW, currently under construction.
“The sector is poised for steady growth. This will
mostly be in the emerging markets around the
world which have an abundance of very high
quality resources,” he told the conference.
“What has driven investment so far, and
what will continue to drive investment, is the
activity of development banks. Development
banks have really picked up their game,” he
commented, noting that money continues to
flow into developing countries.
Additionally, a number of countries have
implemented feed-in tariffs which, he stated, is
helping drive deployment. However, he cautioned
that there are “several uncertainties” that he told
the conference seem “to be systematic around
geothermal developments around the world.”
“When you start to look at the historic
performance of geothermal installations around
the world … we see that the capacity factor
that geothermal actually contains is only 73%
on global average, and that’s in stark contrast to
the accepted wisdom in the industry that you
always get a capacity factor of 95%,” he stated.
“Availability factors are very high, the capacity
factors tend to be low because sites often
under-perform,” he commented. “We’re really
telling the industry to be very thorough in your
resource characterisation and conservative in
your modelling.”
He also cautioned that motivation for Australian
investment is comparatively low in a market
abundant with fossil fuels. “You have a lot of
low hanging fruit,” he observed. “So why would
you do the very difficult thing?”
Indeed, this is a clarion call to the federal and
state governments to continue to provide further
incentive to get projects off the ground, and,
throughout the conference, various aspects of
project management were examined by presenters,
Kobad Bhavnagri, Bloomberg New Energy Finance
Lead Clean Energy Analyst.
from the identification of resources, through to
methods of harnessing resources, to means of
transferring of energy to the electricity grid.
The global financial crisis may well have
presented new challenges for the worldwide
geothermal sector, yet, doubtless, the appetite
for clean and renewable energy technologies
remains, with geothermal at the forefront
of many governments’ thinking. If AGEC
highlighted one thing, it is that the potential for
geothermal energy in Australia is huge and that
there is a significant Australian expertise intent
on driving the industry forward.
As the government continues its push towards
a less carbon intensive economy, future
planning may well see the heat unleashed, but
for the geothermal sector it currently seems to
be a case of “watch this space”.
The 2012 Australian Geothermal
Energy Conference was held near
Sydney’s scenic Coogee Beach.
December 2012 / January 2013 | PESA News Resources | 55