Islandsbanki estimates 5-year growth of 1,300 MW in the U.S.
Operating capacity and capacity in development, overview in Islandsbanki's U.S. Geothermal Energy Market Report 2011
Alexander Richter
31 Eki 2011
Islandsbanki estimates a geothermal power capacity increases of around 1,300 MW over the next 5 years in the U.S. in its newly released annual U.S. Geothermal Energy Market Report.
At last week’s GEA Geothermal Energy Expo and GRC Annual Meeting in San Diego, California, Icelandic Islandsbanki released its annual Geothermal Energy Market Report on the United States.
In the report the bank looks at the current state of the industry in the U.S. The bank sees the challenges for the industry to continue with “a string of negative headlines” and only one plant coming online in 2011.
These current challenges are “reflected in the share performance of publicly traded North American geothermal energy companies”, so the bank and talks further about the struggle of early stage developers to secure the necessary financing to advance their projects”.
Islandsbanki though “perceives this as a temporary setback”, describing the “fundamentals of geothermal energy to remain strong, and with several projects nearing significant milestones, positive news are “around the corner.”
In further highlights the report describes the U.S. as the largest producer of geothermal power in the world, representing today around 3,100 MW of capacity or close to a third of the global installed capacity. Geothermal power represents about 0.4% of electricity generation in the U.S.
There are 170 confirmed projects under development in the U.S., of which 46 are categorized as prospects. Adding unconfirmed projects the total number of projects would be 193.
The lack of early stage and drilling financing has caused delays in the development process.
From developers, Gradient Resources has the largest confirmed geothermal capacity under development with 1,035 MW. Over 76% of that is considered to be at the exploration stage. Terra-Gen represents the largest development currently in the later stage of development with 200 MW.
Islandsbanki estimates that realistically “1,227-1,369 MW of geothermal capacity could come online within the next 5 years”.
While drilling rigs at work on geothermal projects fluctuate, the bank sees the current number at 8 with a requirement of 12 to 20 needed on average from 2012-2014 to bring capacity currently in development online.
The bank also provides an estimate on the investment need for the industry, quoting a demand of $12 billion over the next 12 years of which $5 billion will be required in equity finance.
The report can be downloaded at: www.islandsbanki.is/energy
