450 years' electricity in hot rocks

Weekend Australian
Saturday 9/9/2006, Page: 2

Cooper Basin has the answer to our future needs. And the big plus: no carbon dioxide, no sulphur dioxide, no nitrous oxides and no particulates.

WHILE a political furore envelopes the possible use of nuclear power in Australia, quiet progress is being made on the "next big thing" in national power supply: mining heat from four to five kilometres below the Cooper Basin.

The biggest plus of all is that the process is emissions free. No carbon dioxide, no sulphur dioxide, no nitrous oxides and no particulates, the major emissions from fossil fuels. And, of course, no long-life nuclear waste, so no legacy to burden future generations.

The Canberra-based centre describes the scale of the hot rock resource as "huge". It estimates that the potential recoverable energy equates to Australia's current electricity consumption for 450 years.

Most immediately the first key steps in developing the country's geothermal potential are being taken by Brisbane-based Geodynamics Limited, which includes the major energy companies Origin and Woodside in its shareholders. The company's development plans in South Australia see it first building a 40 megawatt demonstration plant, then expanding it to 280 MW.

Adrian Williams, Geodynamics CEO, says there is no reason why the geothermal sector cannot be generating 10 per cent of Australia's electricity by 2030, with more than 4000 megawatts of generating capacity. He points to the involvement of 14 companies in geothermal energy exploration in Australia, with 87 exploration licences issued and more than $500 million of work commitments over the next five years.

For comparison, Australia's current largest current power station developments are the black coal-fired Bayswater/Liddell complex of Macquarie Generation in the NSW Hunter Valley, with capacity of 4640 MW and the Loy Yang brown coal-fired complex in Victoria's Latrobe Valley, with capacity of 3085 MW.

If output from the hot rock plants reaches 10 per cent of power consumption by 2030, on the basis of current economic modelling of demand it will provide more than 30,000

gigawatt hours a year by 2030- nearly three times South Australia's present production.

Delivering production at this level would require geothermal investors to outlay about $9 billion (using today's dollar values) in capital.

The centre points out that the hot rocks industry has a suite of advantages to sustain its development. Two are natural: there are massive volumes of very hot rocks that were first identified by the oil and gas industry through Cooper Basin exploration over the past 30 years - and there are large amounts of saline water deep underground to provide the medium to move the rocks' energy to the surface in a closed-loop production system.

Other advantages are technological Geodynamics is using existing oil engineering and drilling techniques, and the conversion of the hot water it will bring to the surface from 4000 to 5000 metres to electricity will rely on "of: the shelf" binary cycle power plant technology that is aircooled and to which the company has licensing rights.

In addition, CIE notes, the industry will not require a large number of people to operate the plants and, critically, because it will not need to purchase fuel, it is not sensitive to the future cost of fuels such as gas and coal.

The cost of power is a major factor in any new development. Australia benefits from some of the world's cheapest electricity because of its giant black coal and brown coal resources. wind power has only gained a foothold in the national market because the federal Government has mandated a large subsidy to be paid by customers, In this area, too, hot dry rock is projected to be competitive with new "clean" coal generation, high efficiency natural gas plants and wind.

Geodynamics points out that it is difficult to compare the cost of geothermal with conventional power because most of the costs of an HDR plant are upfront while fossil fuel or nuclear plants buy their fuel over the life of the installation. However, the company claims economic modelling indicates that a 300MW geothermal plant in the Cooper Basin could produce electricity for $40 per megawatt hour, comparable to natural gas baseload costs and substantially cheaper than other renewable energy sources.

Perhaps the biggest challenge to the development lies in building high voltage transmission lines to get the power from the remote desert area to the national electricity market that serves South Australia, Tasmania, Victoria, New South Wales, the ACT and Queensland. The resource being explored lies some 500km from the nearest segments of the national power grid.

"But the scale of the resource is such that we need to think about getting the power to Adelaide. Sydney and Brisbane, or even Melbourne," says Williarris. "These, are long distances, but not by world standards. Using high voltage direct current lines, where the transmission losses are quite low, the cost of links is estimated to be about $700 million to $800 million - and the CIE estimates that the value to Australia through extra NEM competition that the lines would enable would be worth some $1.4 billion."

The national advantages in development of geothermal power do not only lie in the electricity to be sent to the key load centres of the market. The centre's study, which was financed by the South Australian Government and Geodyrtamics, points out that the Cooper Basin projects and the transmission infrastructure they will require will provide power over large parts of Australia that would otherwise not be able to access grid-connected supply. "This," the study says,"will allow development of economic activity that would otherwise not be pursued and (also) bring about earlier development of some activities."

The corridor between Moomba and Adelaide has been identified by the South Australian Government as being rich in mineral resources - but the lack of electricity infrastructure is a barrier to medium and small mining operations. Using South Australian government data, the centre estimates that the gold, copper, minerals sands, uranium and zinc operations that might use power generated by the hot dry rock developments could contribute $4.3 billion to the national economy over the next 30 years.

While the Cooper Basin hot dry rock resources will be the main focus of the establishment of the geothermal industry in Australia for years to come, the CIE also points out that there are many places across the continent with similar potential. "The implied potential energy reserves are massive," it says.

The majority of the best resources seem to be located around the border between South Australia and Queensland, but there are also indications of smaller geothermal prospects along the SA/Victoria border, on the NSW Central Coast and near Brisbane. "Exploration of these may provide resources suitable for production of smaller amounts of electricity closer to urban areas," it says.

Last but not least, the creation of a hot dry rock energy industry in Australia opens up prospects for exporting local skills arid knowledge. CIE says hot rock resources are known to exist in Europe, Estonia, India and Brazil. Potential also exists in Asia

"Australia is competing with operators in other countries to become the first to develop this new form of electricity generation. The scale and the expected commercial development of Australia's HFR electricity supply industry mean (it) is well placed to become a leader in the development of a global industry," it comments. "Australia could garner world-class technological expertise through development of the industry."