EU Energy Strategy
It is important to highlight that the EU energy strategy has three main imperatives— to ensure the security of supply, to ensure competitive energy prices, and to reduce the climate change impacts of energy use. Hence, the need to significantly increase the share of the renewable energy balance is becoming obvious. So far, Europe has developed mostly in the use of wind energy and biomass. Except for Iceland and Italy, geothermal has not been a main player, although the continent has prospective geothermal resources, which can be applied on a wide scale, especially for heating— a main sector contributing to the environmental pollution and GHG emissions. Fossil fuels (plus nuclear in some cases) will still play the main role (Ke˛pin´ska 2008).
According to a study carried out by SHELL that investigates the temperatures at 5,000 m depth (see Fig. 6.3), it can be observed that on the whole territory of the continental Europe there are favorable temperature anomalies, especially throughout the large basins.
However, the development of new geothermal power plants with low-temperature turbine circuits will allow electricity production from low- and medium-temperature resources (between 90 and 150 °C), as demonstrated in Germany and Austria. It is important to note that more than 95 % of the European land surface lies in low- enthalpy regions. For this reason, it is clear what kind of opportunities exist for the future use of geothermal energy for the generation of electricity in the European region.
According to Dumas and Koelbel (2010), the technical feasibility of geothermal energy generation in low-enthalpy areas has long been proved. Although hydrother- mal deposits are currently those mostly utilized, there is common consent within the international geothermal community that EGS—formerly known as “HDR”— as used by the French geothermal prototype facility in Soultz-sous-Forêts, repre- sent the key technology for worldwide development, particularly in the European region.
It is important to stress that geothermal power production using EGS is no longer restricted to special geological characteristics like the natural existence of
large quantities of hot water in the deep underground.2 Although EGS represents the key technology for an economically successful market entrance for geothermal energy under typical European geological conditions, further challenges can be identified. These include the following:
• Improved geophysical exploration;
• An advanced understanding of fracture propagation;
• More developed stimulation techniques.
However, all the relevant equipment for the use of EGS is already available and just needs to be adapted to the new technology. Given that EGS technology can provide reliable base load electricity with capacity factors above 90 % everywhere in Europe, major efforts to develop EGS should pay off. Since the validity of the concept has been demonstrated, EGS power plant ratings should move from 3 to 10 MW seen in the early development stages of the technology toward 25–100 MW units produced from multi-well clusters, as is currently practiced in the oil and gas industry.
The first prototype of an EGS power plant was built in Soultz-sous-Forêts, France. This project integrated all European EGS research activities, with the drilling of three wells to a depth of 5 km. After a successful four-month circulation test that demonstrated the feasibility of the EGS concept at Soultz, the plant was commissioned in 2008. With a circulation of 35 l/s, the capacity of the power plant installation is now 1.5 MW and is planned to rise to 3–5 MW in the future. Among ongoing EGS projects worldwide, the Soultz European pilot site already provides an invaluable database.
In addition, the EU has the first successful commercially funded EGS project in Landau in Southwestern Germany (with a 3 MW electrical output) and further projects are under development in several other EU countries, including the UK, Portugal, Spain, and Slovakia.
In terms of cost, a dry steam power plant today produces electricity at around €50 per MWh and a flash steam power plant at €80 per MWh. In low-enthalpy regions, where binary cycle systems are used, the production costs are in a range between €100 and €300 per MWh. The estimated current cost of EGS electricity generation from the first-generation prototype plants is in the order of €200–€300 per MWh. A continued reduction in cost through innovative developments should lead to an electricity cost of around €50 per MWh.
The keys to minimizing the production costs lie in improved drilling technologies and further developed stimulation techniques and power plant equipment, for example, pumps. Well-drilling makes up a large share of the overnight costs of geothermal electricity generation, sometimes accounting for as much as one-third to one half of the total cost of a geothermal project. Capital costs are very site specific, varying sig- nificantly with the characteristics of the local resource system and reservoir. Especially promising is an upscaling from 25 to 50 MW of the next-generation power plants by using clusters of wells. This possibility of an integrated exploitation of electricity and heat through a cascade approach is a key element for a further drawdown of production costs. By 2030, EGS should be a mature technology capable of providing a reliable, sustainable, and competitive source of energy in all areas. The challenge will be its implementation across Europe replacing the aging existing power production infrastructures.
Geothermal energy provided an estimated 223 TWh of renewable energy in 2012, delivering two-thirds as direct heat and the remainder as electricity. Direct use refers to direct thermal extraction for heating and cooling. A sub-category of direct use is the application of ground-source heat pumps, which use electricity to extract several units of thermal energy from the ground for every unit of elec- trical energy spent. The use of ground-source heat pumps is growing rapidly and reached an estimated 50 GWth of capacity in 2012. At least, 78 countries tap geo- thermal resources for direct heat, while two-thirds of global capacity is located in the USA, China, Sweden, Germany, and Japan.
Europe is the world leader in geothermal direct use. Geothermal is used in 32 European countries, mainly for space heating, bathing, and balneotherapy, than for heating greenhouses, aquaculture, and industrial use. However, except for Italy and Iceland, geothermal energy is not a main player among renewables in Europe, although many regions have prospective resources which can be applied on a wide scale, especially for heating (Ke˛pin´ska 2008).
Geothermal electric generating capacity grew by an estimated 300 MW during 2012, bringing the global total to 11.7 GW and generating at least 72 TWh (REN 21, 2013). The total production is projected to increase to 10.4 TWh in 2020. China remains the presumptive leader in direct geothermal energy use (21 TWh in 2010), followed by the USA (18.8 TWh in 2012),3 Sweden (13.8 TWh in 2010),
Turkey (10.2 TWh in 2010), Iceland (7.2 TWh in 2012), and Japan (7.1 TWh in 2010). Iceland, Sweden, Norway, New Zealand, and Denmark lead for average annual geothermal energy use per person. About 90 % of Iceland’s total heating demand is derived from geothermal resources.
Although there are limited data available on recent growth in direct use of geo- thermal energy, output is known to have grown by an average of 10 % annually from 2005 through 2010; much of that growth was attributed to ground-source heat pumps, which experienced an average annual growth of 20 %. Assuming that these growth rates have persisted in the last two years, the global geothermal heat capacity could reach an estimated 66 GWth before 2014. GHP represents the largest and historically fastest-growing segment of geothermal direct use. In 2012, it reached an estimated 50 GWth of capacity; this amounts to about three-quarters of estimated total geothermal heat capacity, and more than half of heat output. Of the remaining direct heat use (nearly half), the largest share goes to bathing and swimming applications, with smaller amounts for heating (primarily district heating), industrial purposes, aquaculture pond heating, agricultural drying, snow melting, and other uses.
Heat pumps can generate heating or cooling and can be used in conjunction with combined heat and power (CHP) plants. Global installed heat pump capacity doubled between 2005 and 2010, and it appears that this growth has con- tinued in subsequent years. In the EU, GHP capacity rose about 10 % between 2010 and 2011, to a total of 14 GWth, led by Sweden (4.3 GWth), Germany (3 GWth), France (1.8 GWth), and Finland (1.4 GWth). Canada had more than 100,000 systems in operation by early 2013, and the USA is adding about 50,000 heat pumps per year. In 2012, Ball State University in Indiana installed the larg- est US ground-source closed-loop district geothermal system to heat and cools 47 buildings.
According to EU sources, geothermal energy could provide Europe with up to 800 TWh per annum via the hot dry rock concept, if this is technically and economically feasible. This technology aims at “mining” temperatures between 200 and 250 °C, which are available in many places in the EU at a depth of 5,000 m. Geothermal energy depends on similar technology to that of the oil industry. Geothermal energy is a possible medium-to-large renewable energy source with- out seasonal or intermittent production characteristics, but the market potential is unlikely to exceed 2,700 MW, unless cost can be brought down. Research and development is concentrating on new reservoir management techniques, cheaper drilling technologies, and more cost-effective power cycles.
In 2008, the total installed capacity of geothermal power plants in the EU was near 700 MW. In 2011, wind power capacity installed in Europe reached 1,690 MW. Over 50 % of the installed capacity is located in Italy, while there are also some applications in Iceland and Turkey. Greece had a 2 MW geothermal power plant capacity until 1999, but since then the installed capacity in Greece has been removed. In Europe, the total power production from geothermal power plants was 14.832 billion kWh in 2012.
At present, one of the bottlenecks for geothermal development is the low number of drilling rigs and therefore the high cost of drilling. To reach an objective of 20 % of Europe’s primary energy supply by 2050 (100 GW), an average of an additional 25 drilling rigs dedicated to geothermal should be brought to the European market every year between now and 2050, resulting in more than 1,000 drilling rigs dedicated to geothermal development by that date. This is a very large number when compared with the 5–10 rigs currently involved in geothermal activity in Europe, but broadly comparable with the 3,500 rigs operating worldwide in the oil and gas industry (Dumas and Koelbel 2010). Electricity generation from geothermal energy is characterized by:
• Low volatility of the power output: Geothermal power represents an almost no fluctuating source of energy;
• High initial investment costs: A huge hindrance for geothermal power plant is
the high investment costs combined with a high level of uncertainty in the planning stage of a project (i.e., the assessment of drilling costs);
• Lack of high-temperature resources: High-temperature geothermal resources as needed for the state-of-the-art of geothermal power generation are quite rare in Europe and concentrated mainly in those countries where geothermal power plants are already installed. Of course, promising new technological options exist (e.g., HDR) for future exploitation of low-to medium-temperature resources (Resch et al. 2006).