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III. NATIONAL ACTIVITIES UNITED STATES The Nevada PUC also took action in late April to encourage renewable energy development in the state by requiring the state's utilities to consider the economic impact and environmental benefits of renewable resources when preparing their long-term energy plans. The new regulations also allow the PUC to award financial incentives, such as enhanced financial returns, for some renewable energy projects. New Mexico has approved a law requiring the state's major utilities (El Paso Electric, Xcel Energy, and the Public Service Company of New Mexico) to derive ten percent of the electricity they sell from renewable sources by 2011. The law reiterates a mandate passed down by the state's utility regulators in 2002 that requires utilities meet a five percent renewable power threshold by 2006. Western Governors Initiative A group of western governors agreed unanimously in June 2004 to explore opportunities to develop "a clean, secure and diversified energy system for the West and to capitalize on the region's immense energy resources. The energy resolution, adopted at the annual meeting of the Western Governors' Association (WGA), sets a preliminary goal of increasing the efficiency of energy use in the western United States by twenty percent by 2020, and also aims to develop 30,000 megawatts of clean energy by 2015. Clean energy includes renewable energy sources such as solar, wind, geothermal, and biomass energy, but also includes clean coal technologies and advanced natural gas technologies. The WGA will establish a Clean and Diversified Energy Working Group composed of regional stakeholders, with a steering committee comprised of representatives from governor's offices. The WGA represents the governors of 18 western States and American Samoa, Guam, and the Northern Mariana Islands 17.5.2 Development Cost Trends The current cost of geothermal electricity in the United States probably falls in the range of 4- 6 cents per kWh for the best hydrothermal resources. This is a substantial reduction from 10- 12 cents per kWh in the 1980s. To sustain this trend in reduced costs and meet the DOE goals, additional geothermal resources of high quality will have to be found. Thus, in exploration technology development, the trend is toward using improved reconnaissance tools, which can be deployed quickly to characterize large geographical areas. Drilling costs will continue to decrease as a result of experience gained with improved technology. Cost- shared application and testing of EGS techniques at existing hydrothermal sites will continue. 17.6 Development Constraints 17.6.1 Cost and Price Constraints The cost of producing electricity from geothermal resources compared to the cost of electricity from coal and natural gas is the primary constraint on geothermal development, at least in the near term. Geothermal costs have declined dramatically over the last two decades reaching parity with other energy sources at some hydrothermal locations. However, future cost reductions will become increasingly difficult as the industry develops lower quality resources. The DOE Geothermal Technologies Program has adopted a goal for 2010 that reduces the cost of geothermal electricity to competitive levels through improvements in technology and expansion of the geothermal resource base. The existence of a Production Tax Credit will also contribute to bringing additional geothermal resources on line. IEA Geothermal R&T Annual Report 2004.doc 124PDF Image | Geothermal Energy Annual Report 2004
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