WASHINGTON, Nov. 28 (UPI) -- Increasing oil prices and enthusiasm from the incoming Congress are renewing interest in sustainable energy and have led to the construction of 50 to 60 new geothermal power in nine states, Canada and six other countries.
Already in Iceland more than 17 percent of electricity, and in the Philippines, more than 27 percent, is generated from geothermal power, according to the U.S. Department of Energy.
"Geothermal energy is green energy, something that will become more important in a world where we see changes in our climate," said Arni Magnusson, director of sustainable energy for Glitnir Corporate and Investment Banking, the Iceland-based bank that has served the energy industry in that country for decades.
Glitnir announced Nov. 14 at the U.S. Geothermal Development and Finance Workshop in Washington that it would expand its financing ventures to the United States in early 2007.
Currently 7,000 megawatts of geothermal energy are produced in 21 countries. In the United States, it's between $1.3 billion and $1.7 billion a year business and industry leaders see that number growing to near $14.7 billion.
"You have to invest heavily but in Iceland our energy companies have been profitable and we see great potential and we're very excited," Magnusson said.
The latest geothermal projects are invested in making the hot dry-rock method of producing energy more economical; Australia is leading the way in hot dry-rock research in which water is pumped into the ground through hot rocks, then pushed back up through a power plant, cooled and pumped back underground.
"We believe, like so many this is going to be a growing industry in the years to come and we have been successful," Magnusson said. "We have total assets of just below $30 billion so we have the capacity and the strength to do things and we come from a geothermal environment."
Glitner is already in talks with one California energy company over a $100 million to $300 million investment to build a power plant with a 50 MW capacity, said Magnusson, who couldn't give specifics.
Proponents say geothermal power is the most reliable and environmentally friendly form of energy. The Geothermal Energy Association and the Department of Energy want to see the cost reduced to less than 5 cents per kilowatt-hour. The current U.S. capacity is 2,800 megawatts and another goal is to increase the capacity.
In places such as Iceland where there are limited hydrocarbon resources, it is economically viable to use geothermal power. In the United States, however, and many other places, it is still cheaper to use oil, coal or natural gas.
There are also still some researchers who argue that geothermal heat is a non-renewable resource. Regardless, this is not an option for everyone since there are regions where geothermal heat is not accessible.
The American West is seen by some, including Magnusson, as the new frontier in geothermal energy. Projects are planned in Nevada, California, Oregon, Alaska, Arizona, New Mexico, Utah and Hawaii.
Along with the hope of expanding geothermal energy in the United States, industry leaders say they hope government support will grow. Under the 2005 Environmental Policy Act, geothermal plants qualify for production tax credit but the deadline is only a little over a year from now, December 2007.
"Geothermal and other base load renewable power plants take several years to build and many of these plants can't be on-line by the December 31, 2007 deadline," said Karl Gawell, GEA's executive director. "The PTC deadline urgently needs to be extended."
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