Iceland looks to Colorado for geothermal energy projects
Author: Tom Ramstack - August 31, 2018 - Updated: September 13, 2018
WASHINGTON — Iceland, a country with abundant resources in geothermal energy, is setting its sights on Colorado as it tries to tap into the planet’s biggest market for electricity.
New technologies are raising hopes that geothermal energy could produce much of the electricity used in the United States. Some of the sites ripe for geothermal plants lie in southwest Colorado — the Wuanita Hot Springs area and the San Luis Valley — according to the U.S. Geological Survey.
Although no geothermal power plants operate in Colorado now, the state’s geothermal resources are being used for such small-scale purposes as heat pumps, warming pools and spas, greenhouse agriculture and space heating, the Colorado Energy Office reports.
And geothermal’s potential for development in the state is winning support from the National Renewable Energy Laboratory in Golden and a candidate for governor.
Last week, trade representatives from Iceland met with U.S. business leaders to discuss new opportunities during a networking session at a downtown Washington, D.C., restaurant.
Iceland sits on top of fissures in the Earth’s tectonic plates that provide the country with easy access to geothermal energy.
One of its trade representatives is Hlynur Gudjonsson, trade commissioner for the Consulate General of Iceland. He made his first trip to Colorado in 2008, the same year the U.S. Geological Survey published a report saying that “enhanced geothermal systems” could make hotspots throughout the American West ready for industrial production.
“You have a lot of geothermal potential there,” Gudjonsson told Colorado Politics. “I’ve seen how they mapped out the geothermal fields.”
Until now, geothermal energy has been a small player in the electrical generation field.
To tap into it, holes must be drilled deep into the ground where the Earth’s core has superheated subsurface rocks. Water can be pumped down the holes, producing steam when it hits the hot rock.
The steam ascends to the surface, where its pressure cranks the turbines on generators to produce electricity.
For most electrical utilities, the cost of the technology has been too great.
But not in Iceland, where geothermal is its primary source of electricity. The small North Atlantic country has the experience and expertise to capitalize on renewed interest in geothermal, which is why Colorado is one of the western states where it hopes to partner with local utilities.
“It has to do with the geology of the place,” Gudjonsson said.
On Sept. 21, Iceland’s ambassador plans to participate in the first Nordic Commerce Conference at the University of Colorado Denver. Trade representatives from Sweden, Norway, Finland and Denmark also plan to attend.
The business opportunities scheduled for discussion are open-ended, depending on local interest. Gudjonsson said he hopes geothermal energy is one of them.
“In the past we have met with companies and organizations in Colorado on geothermal and we are still interested in that dialogue,” he said.
They are drawing support from the Colorado Energy Office, which reports on its website that “numerous geological formations in Colorado have the potential to produce geothermal energy using heat from the earth.”
Geothermal development fits well with a push among Colorado’s Democrats to find alternatives to coal-fired power plants.
“There is a lot of potential for geothermal in our work to make Colorado 100 percent powered by renewable energy by 2040, especially passive heat systems,” Democratic gubernatorial candidate Jared Polis told Colorado Politics.
“We will work with rural electric co-ops, municipal utilities and investor-owned utilities to lower the financial risks of early-stage investment before we go all in on this resource,” he said. “As governor, I’ll lead the state in making sure we’re implementing new technologies to drive costs lower and in opportunities like geothermal.”
The energy issue page for Walker Stapleton, Polis’ Republican opponent, does not mention geothermal energy.
A manager for the National Renewable Energy Laboratory (NREL) said geothermal energy in Colorado would create opportunities for new public-private partnerships.
“Geothermal development in Colorado would bring these partnerships closer to NREL, allowing us to meet more regularly with stakeholders and continually improve our research and delivery of innovative solutions,” said Katherine Young, the NREL geothermal laboratory’s program manager.
Although the costs can be prohibitive now, the obstacles to geothermal energy are diminishing, according to the NREL.
“Recent research funded by the Department of Energy’s Geothermal Technologies Office and other investors has identified several pathways for reducing geothermal development costs,” Young said. “One example is focusing on significantly reducing drilling costs, as has been seen in the oil and gas industry, since drilling costs make up about 50 percent of the cost of a geothermal power project.”
Iceland’s renewed interest in joint ventures to develop western states’ geothermal energy coincides with the Colorado Public Utilities Commission’s approval this week of a $2.5 billion investment by Xcel Energy in solar, wind and natural gas power for the state.
Xcel says its “Colorado Energy Plan” will add about 1,100 megawatts of wind power and 700 megawatts of solar power to its grid while allowing it to retire its two coal-fired power plants in Pueblo.
Geothermal is not part of the plan but could be added later, according to the Boulder-based nonprofit environmental group Western Resource Advocates.
“The heavy reliance on wind, solar and battery storage in the final portfolios reflects the cost-competitiveness and system benefits of those resources, rather than a pre-determined technology choice,” said Erin Overturf, deputy director of the group’s clean energy program.