The heat beneath our feet: the potential of Latin American geothermal power

Latin America only uses 5% of its natural heat resources, but it is still a small industry and lacks incentives

Tapping into the energy that comes from the natural heat of Earth’s crust could be an efficient and affordable power source for Latin America, say experts. Technology is developing for exploring this source, which comes from the shallow ground, to hot water and hot rock found a few kilometres beneath the surface.

Geothermal power involves drilling wells to extract natural heat often associated with volcanoes or fault lines. In most cases it is drawn using water and steam – as it is in Costa Rica and in Mexico. The geothermal fluids are pumped up from the deep wells to generate electricity.

“In the wake of the oil crisis in the 70s, some countries like Costa Rica chose to turn their efforts into exploiting a local source of energy and decided to enhance geothermal scientific research,” says geologist Guillermo Alvarado Induni from the University of Costa Rica. “It took us a long time to develop this know-how.”

By 2015, 13% of Costa Rica’s energy generation came from geothermal, tapping into the country’s abundant volcanic resources. This small nation of less than 5 million inhabitants is the seventh largest geothermal producer out of 25 producing countries.

In total, it’s estimated that Latin America uses no more than 5% of its geothermal potential of 300 terawatt-hour per year, according to reports released by the Inter-American Development Bank (IADB) and the World Bank. Geothermal currently represents a small portion (less than 1%) of the energy matrix of Latin America. The global falling trend of oil prices and increasing climate concerns on carbon emissions raises the question of how countries should clean their electrical power systems in the future.

Luis Carlos Gutiérrez-Negrín, former president of the Mexican Geothermal Association, says the development of this source has become more competitive and regional cooperation is possible. “Mexico has a historical knowledge of exploring this source and I strongly think we could cooperate with other Latin American countries. So far there hasn’t been a concerted effort to do so,” he says.

Mexico was the first country in Latin America to tap heat from the Earth. With a capacity of 1,017 megawatts, this country is currently the fourth world producer after the United States (3,093 MW), the Philippines (1,972 MW) and Indonesia (1,197 MW).

This renewable source could play a significant role in energy security in the region, adds Gutiérrez-Negrín. “It emits very low levels of greenhouse gas and is the least CO2 equivalent emitter into the atmosphere (compared with coal and natural gas power plants). If the reservoirs are properly managed, they could last over 100 years,” he says.

Scientists and authorities agree that this energy is suitable for supplying base-load power, something that renewable sources are not always the best at, because wind and sun is not constant, for example.

Geothermal has proved to be a feasible source for Mexico, says Michelle Ramírez, director of geothermal at the Mexican Ministry of Energy (Sener) – the government department in charge of production and regulation of energy in Mexico. “Studies suggest there’s a potential of one gigawatt of geothermal energy for every active volcano. Mexico has 25 volcanoes and this potential could be even higher,” she says.

Geothermal plant Las Pailas in Costa Rica
Geothermal plant Las Pailas in Costa Rica Photograph: Fabíola Ortiz

Ramírez believes geothermal is one of the best tools to help Mexico meet its national goals of cleaning the country’s energy mix (it only represents 3%). “This is still a small industry and requires a lot of investment.” By 2024, the country has a target of producing 35% of its electrical energy from renewable sources. Such an ambitious goal boosted a number of government green policies and dedicated public funds to the development of science, technology and innovation projects.

José Manuel Jones is in charge of the Mexican Centre for Innovation and Geothermal Energy (Cemie-Geo), a multi-stakeholder initiative of US$55m connecting universities, private companies and the public sector. A network of 150 experts at seven research institutions will be working until 2018 on more than 30 new projects to enhance geothermal opportunities.

“We still lack comprehensive database to get a clearer understanding of Mexico’s potential. Apart from generating electricity, we could also use for heating buildings, for example. This technology is mature worldwide and we could have it in a near future,” says Jones.

Mexico is among the world’s leading producers of geothermal energy. A new regulatory framework is opening it up to the private sector. While central American countries are also pushing forward and have shown signs of ambitious development – like Costa Rica, El Salvador, Nicaragua and Guatemala.

On the other hand, the “South Cone” – Chile, Peru, Bolivia, Ecuador, Colombia – are far behind the discussion. “The international community is waiting for South America to harness geothermal. There is great interest on us but so far we don’t have any power plant. We need to boost our scientific cooperation,” says Diego Morata, the director of the Andean Geothermal Centre of Excellence (Cega).

In 2017, Chile plans to launch its first geothermal field in the Andean plateau 4.5km above the sea level. With a total investment amount of US$320m, Cerro Pabellón is about to become the pioneer experience in South America with a gross installed capacity of 48MW.

Once it starts running and pumping water in the liquid or vapour phases and transferring the heat from deep hot zones to the surface that will turn the turbines and ultimately produce electricity, the Chilean geothermal plant will generate 340 GWh a year, enough to power 154,000 households.

The Chilean case is quite “puzzling”, admits Morata. The country is enormously dependent on imported fuels, but he Andean volcanic arc is the largest undeveloped geothermal area in the world. Despite its immense untapped potential, no geothermal power plant has been constructed yet.

Some research initiatives led by Cega and the Chilean Geological Survey are increasing the scientific knowledge but there are still many barriers that hinder this energy exploration and exploitation. According to Morata, the insufficient government financial support and the absence of legal framework create levels of uncertainty in the industry delaying and inhibiting projects in Chile.

“Few investors are willing to assume high risks and the Chilean government is not offering any financial incentives,” he says. “We don’t have in-depth data as great part of the information is kept under the hands of private companies restricting our scientific findings.”

Geothermal should be the energy of the future, says Morata, as it would bring a lot of benefits for the Andean countries. It never switches off and that is why Costa Rica decided to bet on this natural resource.

“When Costa Rica started running its first geothermal field in 1994, we’d had over 20 years of research,” says Javier Orozco at the Costa Rican Electricity Institute (ICE). “Once you discover such a good quality source of heat it feels like it’s the Mercedes-Benz of the renewables. It doesn’t need wind, sun or rain.”

This content was produced with the support of the Access to Energy Journalism and Discourse Media.

Join our community of development professionals and humanitarians. Follow@GuardianGDP on Twitter. Join the conversation with the hashtag #EnergyAccess.

Fabíola Ortiz in Mexico City and San Jose

The GuardianTramp

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