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Why Renewable Energy Is Not Cheap and Not Green
Geothermal: The Nonrenewable Renewable
Geothermal -- steam energy that is generated from the earth's heated core -- is currently produced from 19 sites in four western states (California, Nevada, Utah and Hawaii) and accounts for just under one-half of 1 percent of national power production and national generation capacity. Production has fallen far short of projections made in the 1980s203 and is currently in decline due to erratic output from a number of California properties. Nationally, geothermal output in 1995 was 6 percent below 1994, a drop of 971 million kwh.204
The experience of the world's largest geothermal facility -- the 1,672-megawatt facility known as "The Geysers" -- is emblematic. As Pacific Gas and Electric reported:
After reporting a 37 percent performance for 1995 (versus the 33 percent forecast), PG&E predicted a lower percentage for 1996 due to "economic curtailments, forced outages, scheduled overhauls, and projected steam shortage curtailments."206
A number of drawbacks are inhibiting geothermal growth. Geothermal is very site-specific and may not match customer demand centers. These same sites are often located in protected wilderness areas, areas that environmentalists do not want disturbed.207 Unique reservoir characteristics and limited historical experience increase investor risk. Depletion occurs where more steam is withdrawn than is naturally recharged or injected, and "inexhaustible" reservoirs can become noncommercial.208 Alternative water uses or low availability have reduced recharging capacity at The Geysers, for example. Corrosive acids have also destroyed equipment at this facility, and toxic emissions can occur. Promising sites can turn into dry holes upon the completion of drilling.209 Surplus gas-fired generation in California, New Mexico and Utah has also removed the need for new geothermal capacity.210 In 1997, for example, the nation's largest municipal electric firm, the Los Angeles Department of Water and Power, terminated a 1995 commitment to have a 150-megawatt geothermal plant built in its service territory, citing surplus capacity from the impending industry restructuring.211
Concluded one journalist conversant with the Western United States renewable industry:
Is geothermal a renewable resource? One study states that "geothermal is one of the few renewable energy sources that can be a reliable supplier of baseload electricity." Yet the same study opines that "geothermal resources are not strictly renewable on a human time scale, but the source is so vast it seems limitless."213 Christopher Flavin and a new coauthor tell us five years later, "Although geothermal reserves can be depleted if managed incorrectly (and in some cases have been), worldwide resources are sufficiently large for this energy resource to be treated as renewable."214 Yet the supply of coal in the United States and natural gas in North America is arguably "so vast it seems limitless" as well. Geothermal cannot be considered a renewable resource, at least in the United States.
Geothermal is not only a scarce, depleting resource, it has negative environmental consequences despite the absence of combustion. In different applications, there can be CO2 emissions,215 heavy requirements for cooling water (as much as 100,000 gallons per megawatt per day),216 hydrogen sulfide emissions,217 and waste disposal issues with dissolved solids and even toxic waste.218 These issues, including the location problem mentioned above, have caused some environmental groups to withhold support for geothermal since the late 1980s.219
Because of declining geothermal steam supplies, the Company's geothermal units at The Geysers Power Plant are forecast to operate at reduced capacities. The consolidated Geysers capacity factor is forecast to be approximately 33 percent in 1995, which includes forced outages, scheduled overhaul and projected steam shortage curtailments, as compared to the actual Geysers capacity factor of 56 percent in 1994. The Company expects steam supplies at the Geysers to continue to decline.205
By all accounts, the utility-grade geothermal power development business has reached a plateau within the United States. The few dozen viable sites identified and developed in California and Nevada during the 1980s are now entering a mature operational phase. New exploration opportunities -- mainly in Oregon and Northern California -- are sparse due to high cost and perceived "overcapacity" of resources held by utilities. Even expansion of existing plants is limited because of the low avoided-cost energy prices currently available from utilities and the current restrictions on non-utility purchasers.212