The abundant but expensive energy source that's under your feet

An important development from the financial markets: The abundant but expensive energy source that's under your feetImage source, Getty ImagesImage caption, Geysers show us there's plenty of heat in the earth's crustByChristine RoTechnology Reporter, Reporting fromLos AngelesPublished10 minutes agoIt's hard to get Democrat and Republican politicians to agree on much at the moment, but the benefits of geothermal energy is one rare area of consensus. Geothermal energy makes use of natural heat below the Earth's surface and the next generation of technology can access hotter, deeper and more varied locations than ever before. Broadly, the low greenhouse gas emissions of geothermal plants appeals to liberals, while conservatives like the additional energy independence of geothermal, plus the use of drilling technology familiar in the oil and gas industry.

Some US states are trying to accelerate permits for geothermal plants and in April senators from both parties introduced the Next-Generation Geothermal, external Research and Development Act. The legislation would direct the Department of Energy to support the development and commercialisation of the next generation of geothermal energy systems. One emerging type is known as enhanced geothermal systems (EGS).

Economic Details

In EGS, underground rock is fractured hydraulically. That's done by pumping pressurised fluid into one well, and then collecting steam or hot water from another well. Better known as fracking, this technique has become well known and controversial (particularly in the UK) in the oil and gas industry.

"It's the same techniques and up to a point it's the same industry as well," sums up Gernot Wagner, a climate economist at Columbia Business School in New York. But "from a climate perspective, there's a huge difference," he adds. For him, the risk of seismic activity, by creating cracks underground, is outweighed by the benefits of an energy source that is renewable, always-on and large-capacity.

"Based on where we are, moving much faster, much bigger in the direction of using much more geothermal, frankly, is all good news," Wagner says. Image source, QuaiseImage caption, Quaise uses concentrated millimetre-waves to vaporise rockTo go faster and deeper will require advances in drilling technologies. Companies are developing drilling equipment that is more stable when breaking through hard rock at high temperatures.

Analyst Views

Some firms are even aiming to penetrate rock without using standard drills. Quaise, a company with roots at the Massachusetts Institute of Technology (MIT), is using a technology called millimetre wave drilling. The frequency is similar to that of microwaves.

Quaise's application involves "sending electromagnetic waves in the microwave millimetre wave spectrum to essentially melt and vaporise through the rock," explains Harry Kelso, Quaise's communications manager. Traditional geothermal energy clusters around hotspots on the earth's surface where very hot rocks can be easily accessed.

Financial markets are tracking the development closely as investors assess the likely impact.