India Needs To Jump On Geothermal Bandwagon In Race Towards Energy, Climate Goals
India needs to scale up its policies to attract investors, industry players and technology providers to develop geothermal sites.
Imagine generating electricity by tapping naturally occurring heat in the earth’s bowels to generate steam and power a turbine. It’s renewable, free from greenhouse gas emissions, and can be produced 24x7 all year round.
Geothermal electricity is not new — it has been around for decades, albeit as a minuscule part of the global energy mix. With decarbonisation efforts gathering pace around the world, a few smart nations have begun to double down on exploring and developing this relatively under-utilized energy source.
As India braces for the fastest growth in electricity demand in four decades while facing record-high LNG import prices and increased use of coal, it should lose no time and leave no stone unturned in exploring and harnessing its geothermal potential. Geothermal could also help to advance the country towards its 2070 net-zero target by diversifying its energy resources and increasing self-sufficiency.
The stark reality of transitioning from decades of heavy reliance on fossil fuels towards more renewables is that the energy basket of tomorrow will need to have many more components, which means the contribution by relatively small entities cannot be ignored.
The world had about 15.85 gigawatts of installed geothermal power generation capacity at the end of 2021, according to ThinkGeoEnergy Research. That is a mere 0.52% share of the total renewable generation capacity, pegged at 3,064 gigawatts by the International Renewable Energy Association. The share of all renewables is only 9.1% of the total installed power generation capacity around the world.
Fitch Solutions expects geothermal energy to grow at a modest rate of 2.5% per year on average between 2020 and 2029.
Hunt Heats Up
Some countries look at a small ratio and see greater growth potential in it.
The U.S., Indonesia, and the Philippines, the top three nations in installed geothermal electricity generation capacity, are all ratcheting up development of the subterranean power.
Japan, the third-largest holder of geothermal reserves after the US and Indonesia but the 10th largest by installed power generation capacity, unveiled a government-funded phase of exploration to assess 30 locations across the country in August last year.
Japan, Indonesia, and the Philippines sit on the “ring of fire”, a region of Pacific volcanoes with high geothermal potential.
The Philippines has set ambitious targets to boost the sector, with tenders for five new geothermal projects.
Indonesia has been rapidly easing policy challenges that hampered new exploration and development of geothermal power and aims to raise its installed capacity from 2.2 gigawatts of 3.3 gigawatts by 2030.
The U.S. is developing the concept of “enhanced geothermal systems”, wherein heat is extracted by creating a subsurface fracture system, to which water can be added through injection wells. EGS would extend the use of geothermal resources to larger areas of western U.S. The government is funding research and development for transferring best practices from the oil and gas industry to advance EGS as well as conventional geothermal projects.
Turkey, Nicaragua, and Kenya are the other countries expected to see the fastest-expanding geothermal markets over the coming decade.
China is in the early stages of development of geothermal power but is improving its technology and formulating the policy framework for developing the sector.
Geothermal energy is attracting renewed interest in Europe as the region looks to reduce its dependency on Russian fossil fuels while also decarbonizing its heating systems.
The U.K. is studying the viability of retrofitting old North Sea oil and gas wells as well as abandoned coal mines for geothermal technology.
Tapping currently-producing or retired oil and gas wells for their geothermal potential could also hold promise in India.
Cairn India Ltd, which produces about 25% of India’s oil and gas, has embarked on a pilot project to study the feasibility of repurposing some of the oil and gas wells in its South-Barmer basin in Rajasthan to harness geothermal energy for power production.
The process will extend the economic life of current wells and need no additional drilling or subsurface intervention.
Importantly, repurposing of existing wells avoids the high project costs and risks associated with the exploration and development phases of geothermal energy as well as the long environmental assessment processes. As the project is undertaken in an already operational field, there is also no question of disturbing local communities.
If found viable, the project could be put into operation fairly quickly, in contrast to the roughly eight years on average between identifying a site and starting geothermal power production.
The success of the Barmer project could open up a larger area of around 500 square kilometre for geothermal energy development, according to the company.
If the technology is proven, it could also be extended to the country’s old oil and gas fields, giving them a new lease of life.
It is encouraging that India has also begun pushing the exploration and development of conventional geothermal energy, nearly 50 years after the start of preliminary resource assessments.
State-run upstream giant Oil and Natural Gas Corporation. last month began drilling for geothermal energy in Ladakh’s remote Puga Valley, which lies on the Himalayan geothermal belt and could become home to India’s first geothermal power plant.
But the country needs to quickly scale up. It needs to create the conditions to attract investors, industry players, and technology providers who can identify the oil and gas fields or geothermal sites that can be developed economically.
Having the fiscal and regulatory policy frameworks ready will mean the viable projects can be quickly brought to fruition.
Vandana Hari founded Vanda Insights, a Singapore-based provider of intelligence on the global energy markets. A former Asia editorial director at S&P Global Platts, her expert opinions are featured in the international print media, TV and radio channels.
The views expressed here are those of the author, and do not necessarily represent the views of BQ Prime or its editorial team.