A breakthrough in high-speed drilling, coupled with improvements in robotics and sensing technologies, is poised to dramatically transform production of geothermal heat and energy over the next five years, according to Cleantech Group (graphic included).
The key advance in drilling — which accounts for up to 75% of project cost and 90% of capital cost — came from Fervo Energy at its project in Utah. In its 400 MW Cape Station campaign, Fervo drilled its fastest well in 21 days, a 70% reduction from a similar project in 2022. The company also nearly halved the cost to $4.8M per well.
“Increasing adoption of digital tools will enable better controls and real-time drilling data analysis, while new drilling methods, such as drilling with plasma or jets will increase drilling speed,” said Law, pointing out that advanced technologies would directly reduce risks by identifying optimal sites for drilling.
The International Renewable Energy Agency (IRENA) says geothermal energy has the potential to provide up to 17% of global energy needs. Geothermal plants also enjoy multiple advantages. Besides the potential to operate them at nearly 90% load factor, they have lower operational costs than wind and solar photovoltaic and have minimal storage needs.
According to Law, more geographies, such as Germany and other low enthalpy regions, will unlock geothermal power by 2030, as innovation from shallower depths helps to derisk geothermal drilling and penetration rates further improve. This should be underpinned by the rise in long-term offtake agreements from data center operators and other users.
By 2050, the International Energy Agency (IEA) projects demand for geothermal power to rise 15-fold to 1,400MWh and geothermal heat to 1,600MWh.
Other key findings:
• Drilling innovation: GA Drilling and EarthGrid are using high-voltage pulses or electric arcs to create intense heat and induce rock fracturing. Other innovation in drilling includes exposing the hole bottom to a high-pressure jet of steel shot particles, air, hydrogen, propane, or water. HammerDrum is testing robotics, while Cornish Lithium and others are co-locating geothermal heat production with production of lithium or other minerals to drive down costs.
• France steps up. France is aiming for global leadership in geothermal drilling, with an action plan that includes a proposed $150M fund to be unveiled next month. The fund is double the size of incentives announced by the U.S. for geothermal systems. Austria, Germany, New Zealand, the EU and Canada’s Alberta province are among others that are funding research in geothermal initiatives in a renewed push over the past few years.
• M&A activity up. Independent geothermal drilling companies and oil-and-gas (O&G) explorers share some synergies that still remain unleveraged. With the exception of Nabors Industries investing in GA Drilling, Equinor investing in Lithium De France, and BP investing in Eavor, few O&G companies have made direct investments in the geothermal sector. In fact, geothermal drillers face strong competition from O&G firms, which additionally hold a lot of critical patents that curb technology use. Still, M&A activity has picked up since the second half of 2023, and overall investment into geothermal has jumped to nearly $700M since last year.
