California Energy Commission 

Public Interest Energy Research Program Report Abstract

The Hetch Hetchy Water and Power Division of the San Francisco Public Utilities Commission (Hetch Hetchy/SFPUC) commissioned a study in 2004 to provide a portfolio of well-characterized geothermal resources within California and western Nevada that could supply additional power to the California market. This project (Project 1.3) is the geothermal component of the Hetch Hetchy/SFPUC Programmatic Renewable Energy Project, a set of PIER-funded studies to evaluate the potential of a variety of renewable energy sources and options for energy transmission.

The objective of Project 1.3 is to quantify each geothermal resource in terms of its minimum and most-likely generation capacity, estimated costs of exploration and confirmation, and estimated total development costs and unit development costs ($/kW installed), including transmission-line costs as determined by other Hetch Hetchy/SFPUC project participants. Project 1.3 has relied on information in the public domain and such other information as private developers have agreed to contribute. A principal outcome of the work has been the creation of a database (referred to herein as the PIER Geothermal Database) in MS Access. The PIER Geothermal Database includes information about the resource characteristics of 155 separate geothermal projects at 83 resource areas. It also includes embedded documents describing the methodology of the study and tables summarizing results.

Minimum and most-likely estimates of electrical generation capacity have been made for 58 resource areas that have sufficient information in the public domain. The estimates are based on a methodology that has been used by GeothermEx over the past two decades. This methodology is a volumetric reserve estimation approach introduced by the U. S. Geological Survey, modified to account for uncertainties in some input parameters by using a probabilistic basis (Monte Carlo simulation).

Based on the reserve estimates of this study, the electrical generation capacity available to the California market from geothermal sources in California and Nevada has a minimum value of about 4,700 gross MW and a most-likely value of about 6,200 gross MW. After allowances for generation capacity already online, the incremental generation capacity available from geothermal sources in both states has a minimum value of about 2,800 gross MW and a most-likely value of about 4,300 gross MW. These estimates may be conservative to the extent that they do not take into account resources about which little or no public-domain information is available. 

The generation capacity available from fields within California alone has a minimum value of about 3,700 gross MW and a most- likely value of about 4,700 gross MW. The incremental generation capacity available from fields within California alone has a minimum value of about 2,000 gross MW and a most-likely value of about 3,000 gross MW. Geothermal sites in California alone account for about 70% of the combined incremental generation capacity available from both states. Within California, 90% of the incremental generation capacity identified in this study comes from three areas: the Imperial Valley, The Geysers, and Medicine Lake. The Imperial Valley alone accounts for about 65% of the incremental capacity available in California.

For the geothermal sites in both states, the capital cost of incremental generation capacity averaged about $3,100 per kW installed. For California sites alone, the average capital cost of incremental generation capacity was somewhat lower: about $2,950 per kW installed. These cost estimates include the following components: 

• Exploration (up to the siting of the first deep, commercial-diameter hole); 
• Confirmation drilling (up to achieving 25% of required capacity at the wellhead); 
• Development drilling (up to achieving 105% of required capacity at the wellhead); 
• Construction of the power plant (including ancillary site facilities); and 
• Transmission-line costs. 

The capital cost estimates are only approximate, because each developer would bring its own experience, bias, and opportunities to the development process. Nonetheless, the overall costs per project estimated in this study are believed to be reasonable. 

The capital cost for specific geothermal projects ranged from about $1,000/kW (for a small expansion at an existing project) to values in excess of $6,000/kW (for deep, low-temperature resources at remote locations). Of the 4,300 gross MW of most-likely incremental capacity available from both California and Nevada, about 2,500 gross MW is available at a capital cost less than the average of $3,100/kW. Considering just fields within California, about 2,000 gross MW of incremental generating capacity is available at a capital cost below the average of $2,950/kW.

For the purposes of this study, a capital cost of $2,400/kW or less is considered competitive with other renewable resources, both for the California/Nevada study area and for the state of California alone. The amount of incremental geothermal capacity available at or below $2,400/kW is about 1,700 gross MW for the California/Nevada study area, and the same amount (after rounding to the nearest increment of 50 gross MW) for the state of California alone. This amount of geothermal capacity available represents a significant opportunity for commercial development to meet the needs of the California electricity market. Resources with higher estimated costs may also be attractive, depending on market conditions and the mechanisms for implementing California's renewable portfolio standard.

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