Electricity Generation from Geothermal Energy in Australia

Abstract: This thesis aims to investigate the economical and technical prerequisites for electricity generation from geothermal energy in Australia. The Australian government has increased the pressure on the energy sector to decrease the emissions of greenhouse gases. Today, a major part of the electricity production is generated from fossil fuels, and an increased focus on renewable energy resources have emerged in recent years. Geothermal energy is thought to have great potential in Australia due to the high abundance of so-called hot rocks. However, it is still a relatively new technology that has not yet been proved to be economically viable at commercial scale in Australia.   The study will investigate both the technical and economical aspects of geothermal energy as a resource for electricity production. The technical investigation is based mainly on identifying which technologies are suitable for use in Australia, as well as which factors that have the greatest impact on plant capacity. In the economical section of the literature review the costs and economical factors affecting the plant profitability will be discussed. Based on the literature review, an economical model is developed to estimate the profitability of a so-called enhanced geothermal system (EGS) with a binary power plant. The net present value, internal rate of return as well as levelized cost of electricity is calculated for a base case scenario. The base case scenario is based on the current exploratory progress of EGS in Australia to date. The base case is then used as a reference scenario when varying the parameters to determine the effect on plant profitability as well as the sensitivity of the model.   The results of the calculations show that with the current conditions in Australia, electricity generation from geothermal EGS is not viable. The costs are still too high and the amount of electricity that can be produced is limited by a few key parameters. If the obstacles are overcome, geothermal energy could have a great potential as a source for electricity production in Australia.