As the global economy attempts to wean itself from dependence on oil, it will search for viable alternatives. Unfortunately, there is no magic bullet on the horizon that will replace petroleum. The solution for the next few decades 
will be a patchwork quilt of different technologies. The 'alternative' energy sources like solar and wind are non-polluting, but they have serious limitations. While nuclear power will be important, it will not be the best solution for all energy needs.
Part of the answer will be geothermal power. It springs from the simple idea of tapping the energy produced deep in the earth's core by radioactive decay. This heat melts rock, forming magma which can rise just below the earth's surface. Sometimes this energy escapes in the form of geysers or volcanoes at the edge of the tectonic plates.
Geothermal plants work in one of three ways, depending on the temperature of the resource. If the source is very hot, it may have underground steam that can be pumped from the ground to power the turbines in electric generators. If the heat source is under high pressure, hot water can be pumped to the surface. Once the pressure is reduced, it flashes into steam. This steam enters the turbines and produces electricity. When the steam condenses back into water it's reinjected into the ground to refresh the underground reservoir and reheat.
If the temperature is lower (under 300 F), the binary power plant technology developed by the U.S. Department of Energy can be used. Hot water heats a secondary liquid with a lower boiling point like isopentane, forming vapor. This vapor spins a turbine which generates electricity. The secondary vapor cools and recondenses, while the cooled water is returned to the geothermal reservoir.
The reuse of water makes geothermal a renewable source of power. Resources can be tapped for years, as the Geysers field in California has produced electricity continually since 1960.
Originally, it was thought that geothermal energy was only a good choice for areas with very hot rocks or springs near the surface. However, many of the ideal locations for a geothermal plant are a long way from population centers, especially in the U.S. To counter that perception, MIT released a study in January 2007 that asserted the capability of geothermal power to produce a sizable portion of America's electricity at an affordable cost. MIT's research found that enhanced geothermal systems (EGS) could be profitable in cooler locations due to the increasing cost and scarcity of fossil fuels.
EGS requires drilling up to three miles deep, fracturing the bedrock and then producing steam. However, this action may cause a small earthquake as happened with a test well in Basel, Switzerland. While the technology is intriguing, it's still unproven.
Reliable, clean power
A major advantage of geothermal energy is that it's extremely scalable. It can heat one house or power a large city. You may already be familiar with this energy source on a small scale if you have a geothermal pump at your house. In summer, this pump transfers heat from the house into the ground, and in the winter, the warmer soil temperature is used to heat the home.
Unlike solar or wind power, geothermal energy is very reliable. It doesn't depend on the weather or the rotation of the earth. For utilities, steady power production is essential because there is a baseload or minimum demand for energy throughout the day. Geothermal is 'on' an average of 90% of the time compared with 71% for coal or nuclear. By comparison, solar power can provide 18% of its maximum productive capacity, and wind power supplies 30% uptime.
Geothermal power is priced about the same as wind power. It costs less than solar per kilowatt hour output. However, geothermal plants produce five times the energy of a comparably productive photoelectric panel due to the former's greater availability to the grid.
Even the oil and gas industry is interested in geothermal power, as older wells are supplemented by the injection of water into deep wells to force the oil to the surface. The 'waste' water that is produced is hot enough to generate electricity, making the wells a lot more valuable, and reducing exploration risk. While the power produced at any one well is small, aggregating a large field could generate a significant amount of clean energy without much more capital investment.
Geothermal energy is getting more attention lately due to the concern about global warming and pollution. Geothermal plants have very little impact on the environment as they generally replace the water used. Most of the emissions are steam, and that can be scrubbed of naturally occurring hydrogen sulfate. These plants add very little carbon dioxide into the atmosphere.
Regardless of where you stand in the global warming debate, governments around the world are taking it seriously. Nevada has committed to increasing their percentage of energy generated from less polluting renewables to 20% by 2015.The EU is targeting a 20% decrease in carbon dioxide from 1990 levels by the year 2020. Australia plans to slash its emissions 60% by 2050. In many areas, geothermal power can effectively produce power without adding much carbon to the atmosphere.
Geothermal power has achieved much acceptance since Prince Conti produced electricity by tapping an Italian geyser back in 1904. In over 30 countries, geothermal resources generate over 8,000 MW of power. While this sounds impressive, this clean technology has a long way to go. Geothermal plants are responsible for generating less than .5% of the world's energy needs.
Some nations have made great strides in harnessing this clean power source. Iceland is the leader in adopting this technology, as it heats 95% of the buildings in Reykjavik using hot water piped directly from a geothermal reservoir. In the Philippines, geothermal energy provides 27% of the nation's power. Germany subsidizes the industry by offering a free connection to the electric grid for geothermal projects, creating a mini-boom in that nation. Indonesia is building a 340 MW geothermal plant in North Sumatra. Kenya has two plants, and even tiny Nevis is building a plant large enough to supply the island with electricity and export power as well.
American Opportunity
Although the U.S. encompasses the second largest geothermal reserve in the world after Indonesia, the country has barely tapped this potential power source. Only .3% of its electricity is produced by geothermal power. In America, many potential plant sites were located far from population centers and near cheap hydropower, so there was no incentive to utilize this technology.
The situation is evolving rapidly in geothermal energy's favor. Today there is a population shift to many regions where geothermal power is viable, like the areas around Las Vegas, Salt Lake City and Boise, for example. Citizens are more concerned about pollutants emitted from coal-fired plants, and many fear nuclear power. Geothermal plants are a clean, safe alternative.
At the same time, technological advances and the rise in costs of fossil fuels mean geothermal energy is now competitively priced. At current natural gas prices, gas costs between 8 and 9 cents per kilowatt hour in America, while coal has jumped in price and now averages around 5 cents per kWh. Geothermal power costs only 5.5 to 7.5 cents. Expenses vary due to the type of rock the well is drilled into, the productivity of the well, the size of the plant, the distance from the electric grid, and whether it's an expansion of an existing field or a new project.
The price of geothermal power decreases over time as most of the cost is construction related. Although there are maintenance charges, the 'fuel' is effectively free. A 30 year old plant costs 33% less to operate than a 20 year old plant due to its high efficiency and the amortization of equipment costs.
Government incentives make geothermal power even more profitable in the U.S. Federal tax credits of $19 per megawatt-hour are likely to continue. Renewable portfolio standards are already in place in California and Nevada, forcing those states to produce more 'green' energy. Similar standards are proposed in Oregon and Idaho, and the trend is spreading.
I believe that peak oil is a current reality and therefore prices for fossil fuels will continue to trend higher, making alternatives more attractive. As energy is a large slice of everyone's budget, I am always investigating ways for my readers to profit from petroleum scarcity. In the mix of alternative energy sources, I expect geothermal power will grow tremendously in importance in those areas blessed with hot rock near the surface. Once you build the plant, the heat from the earth can be tapped cheaply and cleanly. That combination is hard to beat.
