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9. GEOTHERMAL POWER GENERATION Geothermal resources are the thermal energy available from the Earth’s interior, which is stored as heat in rocks or as steam or hot water in the surface’s crust, or in active geothermal areas, on the Earth’s surface. High‐ temperature water or steam‐based resources (>180°C) are the best for electricity generation, as the liquid can be used directly by dropping the pressure to create steam, (the so‐called “flashing” process), that can drive a turbine. Where only medium temperature resources are available, more expensive “binary” plants are required. These use a heat exchanger to create steam from a liquid with a low boiling point for subsequent use in a steam turbine. Initial exploration (e.g. surface seismic) will be conducted to identify promising geothermal reservoirs suitable for electricity production. This will then be followed by exploratory drilling to confirm or refute the estimations of the exploration process, and to define the extent of the reservoir and its characteristics. This is a time‐consuming and expensive process, and a barrier to the uptake of geothermal power generation. A field development programme can then be developed that takes into account production and reinjection wells, reservoir management, infrastructure and power plant design. However, the field management programme will evolve over time as a better understanding emerges of the reservoir and its flows and characteristics. Geothermal power generation is a mature, commercially available solution to provide low‐cost baseload capacity in areas with excellent high‐temperature resources close to the surface. 9.1 GEOTHERMAL POWER GENERATION INSTALLED COSTS Geothermal power plants are capital‐intensive, but have very low and predictable running costs. Development costs have increased over time as EPC and commodity prices have risen, but also due to drilling costs rising in line with trends in the oil and gas sectors. The total installed costs of a geothermal power plant are composed of the following: • Exploration and resource assessment costs; • The drilling of production and re‐injection wells. This will require a contingency plan, as a success rate of 60% to 90% is the norm for production (Hance, 2005; GTP, 2008). • Field infrastructure and other surface installations; • The power plant and its associated costs; and • Project development and grid connection costs. Today’s total installed costs for geothermal power plant are around 60% to 70% higher than in 2000 (IPCCC, 2011). The costs of conventional condensing “flash” geothermal power generation projects have installed costs of between USD 1 900 and USD 3 800/kW for typical projects (Figure 9.1). The more expensive binary power plant have installed costs for typical projects of between USD 2 250 and USD 5 500/kW (IPCCC, 2011). Renewable Power Generation Costs in 2012: An Overview 73PDF Image | International Renewable Energy Agency
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