Get 30 day free trial

The allure of 24/7 baseload zero-carbon geothermal energy has long been the preserve of countries blessed with volcanic geology. But a Northern Ireland-based startup hopes to harness low-temperature resources using new closed loop systems – potentially bringing cost-competitive renewable heat to markets that are inaccessible to conventional geothermal technology. Energy Flux spoke to Simon Todd, co-founder of CausewayGT, about the opportunities and challenges in this space.

With a PhD in geology and more than two decades of experience at BP in onshore and offshore operational leadership roles, Simon Todd knows a thing or two about drilling wells and subsurface risk. He is now bringing those skills to bear on cracking the long-standing conundrum of how to cost-effectively harness low-grade geothermal resources outside of volcanic hotspots, where most of the global population resides.

“CausewayGT is focussing on decarbonising heat, because that’s where we see the greatest challenge and opportunity,” he told Energy Flux. “The challenge of power is by no means solved, but in Ireland and other jurisdictions we are seeing penetration of 40% renewables into the grid. Heat has a lot of catching up to do.”

Geothermal has been exploited for decades using conventional open loop systems at high-temperature sites close to volcanic activity: think Western US, New Zealand, Iceland, Indonesia and El Salvador – which is drilling new wells to power energy-hungry bitcoin mining rigs.

But these sites are few and far between. Closed loop systems, in which a conductive fluid is circulated through a well to absorb heat held in deep rocks and bring it to the surface, might hold the key to exploiting much more prevalent mid- and low-temperature resource zones.

Environmental impacts are also an issue. Open loop systems often bring potentially hazardous fluids and even CO2 to the surface, which must then be captured and disposed of carefully.

They can also trigger seismic events by injecting water into rocks. A small open loop geothermal project in Holland was recently denied a permit to resume operations after detecting minor earthquakes in the area, sending the operator into bankruptcy.

Since none of the fluid ever leaves the wellbore in a closed loop system, the environmental footprint is “extremely low”, Todd says. “There is no interaction between fluid in the well and fluid in the rocks, so all of those risks are mitigated.”

The difficult part is finding the sweet spot between well depth and heat resource. The aim is to bring sufficient thermal energy to the surface to justify the up-front investment.

The deeper the well, the greater the capital outlay. If going deeper does not materially improve heat recovery, this erodes project returns. Too shallow, and there’s not enough heat to recover.

“One manifestation of the subsurface risk is, how deep do you have to go to get access to the temperatures that are required at the rate of delivery you need to operate the energy system at the surface?” Todd explained.

Share

Money pit?

Critics claim deep closed-loop geothermal cannot be profitable because heat conduction through rock is too slow. They caution that investors will never recover enough energy to recoup their outlay on drilling – even with innovations to reduce well costs and by retailing heat or power at above-market rates.

CausewayGT takes a different view. “We aren’t trying to defeat the first and second laws of thermodynamics,” Todd said.

“My co-founders and I have all had what we call ‘second law moments’ where we’ve questioned, ‘is this really feasible?’ We are confident it can be. It’s all down to technology optimisation and economics.”

North American companies such as GreenFire Energy, Eavor and Sage Resources are vying to roll out pre-commercial demonstrators in the next couple of years – but these focus on power, not heat, and aren’t expected to herald a panacea for decarbonised baseload electricity. At least, not yet.

The levelised cost of energy (LCOE) of these new geothermal developments will probably be well above more mature renewable technologies such as onshore wind or utility scale solar PV – maybe in the ballpark of $300-400 per MWhe.

“That might seem pretty high. The question is, can you convince yourself and other investors that that demonstrator is a springboard up the learning curve and down the cost curve?” the CausewayGT co-founder said.

This is where a background in oil and gas operations helps. Technological optimisation and enhancement, as well as operational efficiencies, will all play a big role.

“We know from our oil and gas experience that drilling goes through a phenomenal learning curve. The last well is often half the cost of the first,” Todd said.

Lazard’s latest LCOE analysis, released in October 2020, puts conventional geothermal energy in the range of $59-101 per MWhe. That’s on a par with community-scale solar PV, but well above utility-scale wind and solar.

If closed loop systems can attain LCOEs comparable to open-loop but from low- and mid-temperature sites and with availability in the 80-90% range, then Todd and others believe it will offer a viable solution for the widespread decarbonisation of heat.

CausewayGT will focus initially on its home market in Northern Ireland, Ireland and Great Britain with ambitions to expand overseas. But investors will need to take a broad view of the opportunity, and be prepared to commit for the long term.

The team is focussed on pre-feasibility studies and early front end engineering and design (FEED) for an initial demonstrator project, which is at least two years away. That would be followed by another three years or so of learning and optimisation.

“Success on that then leads to phase three: commercial scale plants,” Todd said. “We are only just getting started.”

Get more news commentary like this straight to your inbox, three times per week:

Get 30 day free trial