The Geothermal Energy Association recently sent a letter to its members enclosing a study by the GEA on “Firm and Flexible Power Services Available from Geothermal Facilities.” We agree with the main theme of the GEA study, which is that geothermal generation of electricity must be combined with wind and solar power, and provide the balancing energy or other ancillary services that the grid requires when significant amounts of intermittent renewables are used, thereby enabling all three forms of renewable energy to expand rapidly and replace fossil fuels as soon as possible. The GEA study advocates that geothermal plants should seek to operate in various “flexible” modes in order to accommodate an electricity grid dominated by variable energy resources, rather than in the customary baseload mode. We would suggest that, by making full use of geothermal resources and the most recent developments in technology, geothermal facilities can operate in baseload mode and still accommodate variable energy resources.
The GEA study focuses primarily on the mode of operation of existing geothermal facilities. Most of the existing geothermal capacity in the U.S. is in California, and most of the capacity outside California is in Nevada. Solar and wind power provide more renewable energy than geothermal power, and at certain times they provide more power than the grid needs. The GEA study notes that some geothermal facilities have contracted to operate, and others could operate to some extent, in “flexible mode” rather than in “baseload mode” under modified contracts and/or making retrofits. The GEA study also notes that operating in flexible mode can often be less efficient and more expensive than baseload operation, and that certain of the flexible geothermal facilities ceased operating in flexible mode because of low demand for their ancillary services and/or price competition from other forms of power. The GEA suggests that geothermal facilities should contract for a capacity charge or other payment for providing ancillary services (in addition to charging for the electricity that the grid takes) and should use storage for excess electricity until it is needed for the grid.
Storing electricity is, however, expensive and, because it is not 100% efficient, it actually wastes electricity. On the other hand, several of the major automakers are beginning to design and build cars that will run on hydrogen rather than batteries, and California has announced plans to build more hydrogen service stations around the state in order to expand the use of hydrogen to replace gasoline. Moreover, transportation and industrial heating fuels each create more greenhouse gases in California than the generation of electricity, and hydrogen can solve those issues. The major problem with hydrogen as a solution now is that most hydrogen is currently created by steam reformation of methane, which consumes fossil fuels and releases greenhouse gases. Thus, it flies in the face of the need to cut the use of fossil fuels.
Hydrogen can be produced by electrolysis, using the off-peak geothermal electricity that would otherwise be stored instead of fossil fuels, but in the past electrolysis has been too inefficient and expensive. Recent research has, however, found that electrolysis is more efficient when conducted at higher temperatures, which could be supplied from geothermal resources. Moreover, electrolysis can be cut back to operate at less than 10% of capacity without a significant loss of efficiency, and such cut backs can be performed in less than 2 seconds. The electricity that would otherwise power the electrolysis can therefore be switched to provide balancing or other ancillary services immediately. Other research has found ways to decrease the cost of the electrodes that are needed, which will further reduce the cost of electrolysis. Thus, geothermal wells can run in baseload fashion, as they should, while the electricity is used to balance the grid and/or to produce hydrogen, as the circumstances dictate, by using the geothermal energy for the generation of electricity and/or the electrolytic production of hydrogen. Hydrogen inventories will be analogous to storage, from the perspective of electricity generation. On the other hand, as a fuel for transportation and heating, which have always been produced for and drawn from inventory, hydrogen will open a whole new market for the geothermal industry, and one that is expected to grow rapidly for the foreseeable future. The geothermal industry should benefit substantially from participating in a new, expanding area of the energy industry, rather than fighting to squeeze into a part of the energy industry that sometimes suffers from overcapacity.
Moreover, following this strategy in the future, geothermal energy can be even more promising in the future than it will be operating as described above in the existing market. While California and other well-developed energy markets face the issues discussed above, other markets around the world have completely different issues and characteristics. Moreover, each market will continue to change as the global energy industry continues to change and evolve. Geothermal energy will, however, have the flexibility to respond to the full range of issues. By developing the ability to produce and provide both electricity and hydrogen flexibly, and to balance between the two quickly, geothermal energy will gain and hold a major role in the new, unified energy industry around the world – as it should.