Geothermal Generation: Zero-Carbon Baseload and Flexibility Resource
Geothermal generators are baseload plants capable of providing valuable services to the grid, such as generation flexibility.
Prior to 1980, geothermal generation remained below 5 TWh annually. Between 1980 and 1989, generation tripled to 15 TWh as new facilities came online.
Much of the early growth in geothermal power was driven by Public Utility Regulatory Policies Act incentives, although this driver has declined over time as the avoided costs of utility generation have fallen.
As of 2015, geothermal power continues to generate roughly 15 TWh of electricity annually, or roughly 0.4 percent of total U.S. electricity generation.
Challenges in exploring new “blind” hydrothermal resources and long drilling times for production wells have led to increased uncertainty for investors in large geothermal projects. Additionally, tax credits that are only extended for short periods of time do not take into account the long lead time of geothermal project
development, scarcity of power purchase agreement opportunities, or need for transmission infrastructure.
Current ancillary service compensation models in areas with the most geothermal development do not provide sufficient revenue to warrant the increased operational and control retrofitting expenses. If appropriately valued, the services a geothermal plant can provide include regulation, load following, spinning reserves, nonspinning reserve, and replacement or supplemental reserve.
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(Thanks to GRC Member Marcelo Lippmann, Staff Scientist (retired) at Lawrence Berkeley National Laboratory for the submission.)
