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All the energy we’ll ever need is 5,000 metres below our feet. It works all day, every day. And if we can drill a deep enough hole, it’s ours for the taking.
This is the promise of geothermal energy.
There are a few details. It turns out to be quite hard to drill down 5,000 metres. The drill bits melt. Getting the energy out requires a lot of horizontal drilling and fracking. Getting governments to approve these schemes is hard work. Getting capital to back enhanced geothermal (the term for the deepest drilling projects) is difficult, when the technology is years from being economical.
Progress is being made across the industry. Last month, a company called Fervo Energy made a breakthrough at a site in Nevada, where it was able to generate 3.5 megawatts of power. That’s about as much power as a small solar farm. Such a result had been thought to be years away.
The geothermal industry is based in Houston, Texas. Not because the geology of Houston is particularly suited to geothermal, but because Texas is the global capital of the energy and drilling industry. Advanced drilling techniques from Texan companies enabled fracking and the extraction of shale oil. Some of those drillers are now turning their attention to geothermal.
A lockdown business idea
Simon Todd is one of them. Todd is from Portstewart, Co Derry. After getting a PhD in geology, he spent 25 years working for BP, mainly in Houston. Three and a half years ago, he started a new company — Causeway Energies. His goal is to commercialise a form of geothermal energy for which, he says, Ireland is particularly well suited. As with many business ideas, it sprouted during the lockdowns.
“At the beginning of 2020, just before the lockdown, I had been appointed as an adjunct professor to the School of Earth Sciences at UCD. I met with several scientists in Dublin for lunch at Belfield. I asked them, ‘Is there something I can contribute that would be of interest to you?’ They said, ‘It might be interesting for you to leverage your executive and technological experience from the United States to explore the geothermal scene there and its implications.’ I thought, ‘Sure, that sounds intriguing.’
“Then the lockdown happened. I went into Dr Google mode — Zoom, Microsoft Teams, and networking with experts from the US and Europe. What became evident was that although Ireland’s geothermal resources are modest in temperature compared to renowned hotspots like California, Indonesia, or Iceland, we possess a valuable heat resource that remains largely untapped, especially when compared to European nations like Sweden, Denmark, Germany, and France.”
When Todd talks about geothermal in Ireland, he’s not talking about drilling 5km down, and drilling horizontally, and fracking, and hoping to figure out the technology as he goes along. His ambitions are much more modest: “In Ireland, the immediate opportunity lies in shallow geothermal,” he said. “This involves harnessing heat from less than 200 meters deep and utilizing a heat pump to raise the temperature. This process proves highly efficient in terms of energy products. One method involves a shallow groundwater aquifer where water is extracted, processed through a heat exchanger in the heat pump to capture a few degrees of heat, which is then amplified by the system.”
This isn’t a new technology. 64 per cent of Denmark’s heating comes from district heating. That’s a closely related technology whereby heat is piped to homes from a central location. Geothermal in Ireland would have this feature. But an extra detail is that the central location would pull heat from under the ground.
So there are two distinct technologies. One is the technology to pull heat from under the ground. Then there’s district heating, whereby heat is distributed from a central source to ordinary homes. Geothermal technology could work without district heating, at the scale of a single factory. Or it could be combined with district heating to heat a city.
At first, Causeway Energies wants to focus on industrial applications: “Causeway’s mission focuses on the decarbonization of large industrial heating, commercial and public service buildings, heat networks, and agriculture,” said Todd. “Although we emphasize geothermal, our portfolio encompasses more than just this technology. Interestingly, nearly half of Ireland’s decarbonization challenge pertains to heat, not electricity or mobility.”
Once the technology is proven at the scale of a factory, the next step could be to expand it to domestic households: “Breaking down Ireland’s heating needs, a significant portion, sometimes up to 50 per cent, originates from domestic households. The next major contributor is the industrial sector, including agriculture, manufacturing, pharmaceuticals, brewing, and more.”
“Besides the technical and economic hurdles around geothermal, there’s also a suspicion of the unknown.”
Causeway Energies’ technology uses drilling to pull heat from underground and then amplifies it using heat pumps. What’s stopping Ireland from adopting this technology at scale? “The primary economic concern with these heat pumps revolves around their efficiency,” said Todd. “There are two key numbers: the coefficient of performance and the ratio of electricity cost to gas cost. We’ve observed that if our models show a coefficient of performance of four or higher, geothermal proves economically competitive against traditional gas boiler systems. And this doesn’t even account for the carbon savings.
“Besides the technical and economic hurdles around geothermal, there’s also a suspicion of the unknown. One of the barriers we encounter is the general lack of awareness about geothermal technologies in Ireland.”
Todd is back and forth between Ireland, where his target market is, and Houston where cutting-edge science is centred. He’s trying to act as a bridge between the two. “The proposition that we’re thinking about is, we apply for equity funding in our next engagement with venture capital and impact funds. That’s what we’re currently thinking.”
For investors, there’s an obvious pitch to be made: “In the shale industry in the United States, we’ve observed how drilling lots and lots of wells, and doing lots and lots of projects — the learning and the continuous improvement within that process allows for radical cost reduction and efficiency improvement.”
“Drawing parallels to the solar PV industry and its remarkable cost reduction over two decades, I anticipate a similar trajectory for geothermal projects,” he added.
