GEOTHERMAL ENERGY MARKET REPORT

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GEOTHERMAL ENERGY MARKET REPORT ( geothermal-energy-market-report )

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KEY FINDINGS Tremendous opportunities in the utilization of geothermal energy in the U.S. • The biggest potential for geothermal energy applications in electricity production is in the Western States, primarily in California, Nevada, Idaho and Oregon. In California, geothermal could provide about 20 percent of today’s electricity needs. In Nevada this could be even 60 percent and 17 percent of the electricity in Idaho could come from geothermal. In Hawaii, the potential of geothermal power is particularly interesting, as it could provide around 30% of the islands’ electricity needs, decreasing the state’s dependence on fossil fuels. Most of the current development is taking place in Nevada and California. • Glitnir estimates the investment requirement to service current projects to be some USD 9.5 billion. A total Investment of USD 16.9 billion will be required to develop available resources over the next 8 years with a further USD 22.5 billion during the following 10 years. We forecast that the total investment needed to develop the resources available is in the region of USD 39.4 billion until 2025. • Sales of geothermal powered electricity could increase from currently USD 1.8 billion to USD 11.0 billion, without taking into consideration the vast opportunities for the development of geothermal direct use applications, e.g. geothermal heat pumps. • The geothermal industry in the U.S. is still very fragmented, consisting of relatively few big companies and many small ones. Some of the smaller companies lack the financial strength to fully develop projects that in many cases could be profitable. Therefore Glitnir believes there will be considerable consolidation in the industry in the next few years. • For successful development of the geothermal industry it will be necessary to increase the capacity of drilling equipment and related human resources. As the industry is recovering from a decline that took place in the late 1980s and is to some degree competing with the oil industry for human resources, it is crucial to train and educate people to work within the sector. September 2007 – Glitnir Geothermal Research 5

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