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Chapter 4 Geothermal Energy Bathing, swimming and balneology are globally widespread. In addi- tion to the thermal energy, the chemicals dissolved in the geothermal fluid are used for treating various skin and health diseases. Greenhouses heated by geothermal energy and heating soil in outdoor agricultural fields have been developed in several countries. A variety of industrial processes utilize heat applications, including drying of forest products, food and minerals industries as in the USA, Iceland and New Zealand. Other applications are process heating, evaporation, distillation, ster- ilization, washing, and CO2 and salt extraction. Aquaculture using geothermal heat allows better control of pond temperatures, with tila- pia, salmon and trout the most common fish raised. Low-temperature geothermal water is used in some colder climate countries for snow melting or de-icing. City streets, sidewalks and parking lots are equipped with buried piping systems carrying hot geothermal water (Lund et al., 2005, 2010a). Geothermal direct uses have experienced a significant global increase in the last 15 years (Table 4.4) after a period of stagnation (1985 to 1995), mainly due to the increasing costs of fossil fuels for heating and cooling and the need to replace them with renewable sources. The technical potential of direct-use applications for heating and cooling buildings is still largely unrealized (Lund et al., 2010a). 4.4.4 Impact of policies10 For geothermal to reach its full capacity in climate change mitigation it is necessary to address the following technical and non technical barri- ers (Wonstolen, 1980; Mock et al., 1997; Imolauer et al., 2010). Technical barriers. Distributions of potential geothermal resources vary from being almost site-independent (for GHP technologies and EGS) to being much more site-specific (for hydrothermal sources). The distance between electricity markets or centres of heat demand and geothermal resources, as well as the availability of transmission capacity, can be a significant factor in the economics of power generation and direct use. Non-technical barriers. • Information and awareness barriers. Lack of clarity in understanding geothermal energy is often a barrier, which could be overcome by dissemination of information on reliable and efficient geothermal technologies to enhance governmental and public knowledge. On the other hand, for deep geothermal drilling and reservoir manage- ment, skilled companies and well-trained personnel are currently concentrated in a few countries. For GHP installation and district heating, there is also a correlation between local availability and awareness of service companies and technology uptake. This con- straint could be overcome by an improved global infrastructure 10 Non-technology-specific policy issues are covered in Chapter 11 of this report. of services and education programs (geothermal engineering pro- grams) for an expanding workforce to replace retiring staff. • Market failures and economic barriers, due to un-priced or under- priced environmental impacts of energy use, and poor availability of capital risk insurance. • Institutional barriers due in many countries to the lack of specific laws governing geothermal resources, which are commonly consid- ered as mining or water resources. Policies set to drive uptake of geothermal energy work better if local demand and risk factors are taken into account (Rybach, 2010). For example, small domestic heat customers can be satisfied using GHP technologies, which require relatively small budgets. For other coun- tries, district heating systems and industrial heat applications are more efficient and provide greater mitigation of CO2 emissions, but these markets typically require larger-scale investments and a different policy framework. Policies that support improved applied research and development would benefit all geothermal technologies, but especially emerging technolo- gies such as EGS. Specific incentives for geothermal development can include fiscal incentives, public finance and regulation policies such as targeted grants for pre-competitive research and demonstration, subsidies, guarantees, tax write-offs to cover the commercial upfront exploration costs, including the higher-risk initial drilling costs, feed-in tariffs and additional measures like portfolio standards (Rybach, 2010). Feed-in tariffs (FITs, see Section 11.5.4.3) with defined geothermal pric- ing have been very successful in attracting commercial investment in some European countries such as Germany, Switzerland, Belgium, Austria, Spain and Greece, among others (Rybach, 2010). Direct subsi- dies for new building heating, refurbishment of existing buildings with GHP, and for district heating systems may be also applicable. Experience has shown that the relative success of geothermal devel- opment in particular countries is closely linked to their government’s policies, regulations, incentives and initiatives. Successful policies have taken into account the benefits of geothermal energy, such as its inde- pendence from weather conditions and its suitability for base-load power. Another important policy consideration is the opportunity to sup- port the price of geothermal kWh (both power and direct heating and cooling) through the United Nations’ Clean Development Mechanism (CDM) program. A recent example is the Darajat III geothermal power plant, developed by a private company in Indonesia in 2007, and regis- tered with the CDM. The plant currently generates about 650,000 carbon credits (or certified emission reductions, CER) per year, thus reducing the lifecycle cost of geothermal energy by about 2 to 4% (Newell and Mingst, 2009). 417PDF Image | Geothermal Energy 4
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