"Geothermal has two important qualities -- it provides base-load power, and just 1 per cent of Australia's geothermal energy resource is enough to support the country's energy needs 26,000 times over."
THE official opening of Petratherm's Paralana geothermal project in the middle of South Australia's outback on Friday was notable for Martin Ferguson's concession that geothermal energy could one day be competitive with coal.
Geothermal has two important qualities -- it provides base-load power, and just 1 per cent of Australia's geothermal energy resource is enough to support the country's energy needs 26,000 times over.
At between $75 and $120 per megawatt, the cost is about double that of coal-fired electricity, but rising coal prices and the inevitable carbon price will narrow that gap and ultimately make it a cheaper source of power. And geothermal is about half the price of current estimates of carbon capture and storage, and its costs will probably fall -- which must make it very tempting for the government to throw as much money at geothermal as it has to carbon capture and solar.
The challenge for geothermal development has been for start-up companies to obtain finance to fund the expensive deep-drilling that is required to prove and then tap the resources. The industry is hoping that more of the $50 million made available by the government to help fund these drilling programs will be made available in the next round. Only two $7m grants were announced in the first round in April, but there is a growing queue of applicants.
Greenearth Energy has made its second application for funding to help with the cost of drilling around Geelong, while Green Rock Energy has made an application for its project to provide air conditioning at the University of WA. Kuth Energy has made an application for its project in Tasmania, while Torrens Energy and others seeking help for projects in South Australia.
TEY Price at posting:
31.7¢ Sentiment: None Disclosure: Not Held
