Renewable Energy and Related Services: Recent Developments

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Renewable Energy and Related Services: Recent Developments ( renewable-energy-and-related-services-recent-developments )

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TABLE 5.15 Estimated market for geothermal energy-related services based on existing projects, by region and selected country, 2010 Region/country Geothermal power capacity 2009-10 2009 2010 growth Estimated size of project development services market Estimated size of variable O&M services market MW 633.0 731.0 98.0 Million $ New Zealand Italy 700.0 United States 2,381.9 Philippines 1,953.0 Indonesia 1,189.0 Japan 535.0 Mexico 965.0 Iceland 575.0 El Salvador 204.4 World 9,892.8 Sources: U.S. Energy Information Administration (EIA), “Annual Energy Review 2011,” 2012; B&V, “Cost Estimates and Performance Data for Renewable Electricity Technologies,” 2012; and calculations by the Commission. Note: Figures for the market for project development services include estimates of EPC and owners’ costs, and are based on the annual market for one year’s new construction. Owners’ costs primarily include services such as feasibility studies, environmental impact studies, resource assessments, and permitting and other legal costs. Figures for the market for variable O&M services are based on the cumulative reported capacity for each market. According to B&V, fixed O&M costs for the geothermal sector are zero, although other sources do quote fixed O&M costs for geothermal plants. Since the estimates in this chapter rely on B&V, we do not cite fixed O&M costs here. provide potential investors and financing entities with better information about geothermal resources prior to the tendering process for specific development blocks. The program had received about $200 million as of 2012. Another program provides loan guarantees to certain geothermal energy project developers after the tendering process, as they actively develop new power projects.124 In contrast, unclear government policies, conflicting regulations, and bureaucratic problems in obtaining project permits have acted as roadblocks to new development in Indonesia, a country with aggressive targets and some of the world’s largest geothermal energy resources.125 Argentina, Ethiopia, Indonesia, Kenya, and the Philippines have among the most ambitious long-term geothermal energy targets, although it remains unclear whether those targets will be met. In Indonesia, for example, industry observers consider it unlikely that the country will meet its 2020 targets for new geothermal power production.126 On the demand side, populations and economic growth are increasing the need for affordable and reliable energy in emerging markets. Other significant factors are access to power transmission, project lead times, and the price of electricity. Global Industry Trends The global geothermal power industry is dominated by multinational firms that provide geothermal energy services worldwide. The industry is relatively concentrated—the top 10 geothermal energy producers account for 64 percent of installed geothermal power 124 Government representatives, interviews with USITC staff, Jakarta, July 3 and 4, 2013. 125 Industry representatives, interviews with USITC staff, Jakarta, July 3 and 4, 2013. 126 REN21, Renewables 2012, 2012; industry representatives, interviews with USITC staff, Jakarta, 750.0 50.0 2,405.0 23.1 1,966.0 13.0 1,197.0 8.0 145.5 180.6 74.3 185.3 34.3 594.3 19.3 485.8 11.9 295.8 537.0 2.0 965.0 – 575.0 – 204.4 – 3.0 132.7 – 238.5 – 142.1 – 50.5 10,104.9 212.1 315.0 2,497.1 July 3 and 4, 2013. 5-32

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