I sat in on a webinar this morning on the global future of major geothermal projects. The webinar, hosted by the website for the event GeoPower Europe, talked a lot about why the U.S. is growing when it comes to geothermal, but not nearly as fast as other areas.
I sat in today on the webinar I mentioned last week on geothermal, its future and what the growth areas are. In short, things are growing in the United States, but not as fast as they could. The real boom areas, the three experts on the webinar said, are developing countries.
Why is that? Investors in the U.S. are hesitant to move forward on large geothermal projects and development banks like the World Bank are making up the difference in up-and-coming nations.
"Over the past decade, about two-thirds of financing for geothermal projects has come from state agencies or development banks," said Alexander Richter, founder of ThingGeoEnergy. Other geothermal veterans on the webinar included Hezy Ram, a geothermal consultant and founder of Ram Power, and Siddhartha Sinha, vice president of Marathon Capital.
Richter kind of shakes his head at commercial lenders’ hesitance to fund major geothermal projects. Ram agrees.
“The fact of the matter is, from a statistical point of view, geothermal development is not that risky,” Ram said, adding a comparison to the oil and gas industry. Three out of four geothermal wells drilled during exploration come out successfully, he says, compared to one out of two in oil and gas exploration.
Ram points to Guatemala, Kenya, Turkey, and Philippines as hotspots for geothermal development.
And, globally, geothermal’s not going anywhere. Richter says current projects under development would triple installed capacity to more than 33,000 megawatts, mostly in areas of South America, east Africa and Asia.
But it’s not all gloom in the U.S. Sinha said he expects a wave of new construction and financing in the near term. There’s a lot of investor interest in a geothermal plant, he says, once it’s up and running.
“The trick is, how do you get it up and running?”
The key to that, he says, is getting independent experts to attest to your exploration site-“that there is steam behind the pipe.” Then, show investors it’s a viable long-term resource by maintaining it once it’s up and running.