In use for more than 100 years, geothermal energy is low carbon and abundant but has so far been confined to areas of volcanic activity or near to tectonic fault lines. The new report, The Future of Geothermal Energy, outlines how breakthrough drilling technologies could allow many more regions around the world to access geothermal power.
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According to the IEA, growth in the sector could attract investment of $1 trillion over the next decade if these technologies are adopted, with costs dropping as low as $50 per MWh. Longer term, the report predicts that geothermal energy could meet 15 per cent of global electricity demand growth between now and 2050 if project costs continue to decline.
The IEA report also highlights how geothermal energy can draw upon the expertise of today’s oil and gas industries, harnessing existing drilling techniques and equipment to go deeper under the Earth’s surface.
“New technologies are opening new horizons for geothermal energy across the globe, offering the possibility of meeting a significant portion of the world’s rapidly growing demand for electricity securely and cleanly,” said IEA executive director Fatih Birol.
“What’s more, geothermal is a major opportunity to draw on the technology and expertise of the oil and gas industry. Our analysis shows that the growth of geothermal could generate investment worth $1 trillion by 2035.”
If next-generation geothermal grows strongly in the coming years, employment in the sector could increase sixfold to 1 million jobs by 2030, according to the report. The IEA claims that up to 80 per cent of the investment required in geothermal involves capacity and skills that are transferrable from existing oil and gas operations. Furthermore, investment in the sector by oil and gas majors could be seen as a hedge against projected future decline in fossil fuel demand.
The report also highlights geothermal’s potential to help power the increasing number of large data centres that underpin the tech sector, with the growth of AI power demand a particular concern. With next-generation geothermal offering a stable and essentially inexhaustible power source, large technology companies are already signing power purchase agreements with new projects.
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