Thursday, March 05, 2009

More on ...

... Geothermal Power.
Two recent reports, among others, suggest that geothermal may actually be cheaper than every other source, including coal.
Of course ...
That does not mean companies are rushing to build geothermal plants: There are a number of assumptions in the geothermal figure. First, there are the tax incentives, which save about 1.9 cents per kilowatt-hour. Those won't necessarily last forever, however—although the stimulus bill extended them through 2013.

Second, the Credit Suisse analysis relied on what is called the "levelized [sic] cost of energy," or the total cost to produce a given unit of energy. Embedded within this figure is an assumption that the money to build a new geothermal plant is available at reasonable interest rates—on the order of 8 percent.

In today's economic climate, that just isn't the case. "In general, there is financing out there for geothermal, but it's difficult to get and it's expensive," Geothermal Energy Association director Karl Gawell told recently. "You have to have a really premium project to get even credit card interest rates."

That means very high up-front costs. As a result, companies are more likely to spend money on things with lower front-end costs, like natural gas–powered plants, which are cheap to build but relatively expensive to operate because of the cost of the fuel needed to run them.
It's a good, informative read. Check it out.

In the meantime, I'm off to analyze some data and write up another manuscript. No rest for the weary!

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