The state’s wildcatting entrepreneurs, embrace of light regulations, and, of course, drilling experience have set the stage for a world-leading boom in geothermal energy production. Even Trump is excited about it.
In a “drill, baby, drill” administration that has already shut down wind energy expansion and put the solar industry in limbo by pausing funding and threatening Inflation Reduction Act incentives, one clean energy source has received support from President Donald Trump. In his bid to unleash American energy dominance, geothermal energy (harnessing underground heat as a renewable resource) got a shout-out in a January 20th executive order. It’s the rare clean energy option that hasn’t been singled out for criticism. And one state is poised to be the center of that boom.
Texas’s wildcatting entrepreneurs, embrace of light regulations, and, of course, drilling experience have set the stage for a world-leading boom in geothermal energy production. Not only does the Lone Star State boast a significant number of operators and a labor force that knows how to drill—at the peak of the recent shale oil boom, more than 20,000 wells a year were being dug—but all this activity means a good portion of the state’s underground landscape has already been mapped, making it that much easier to locate good spots for geothermal wells.
Geothermal energy production has traditionally included a handful of power plants, built where water heated from the earth bubbles toward the surface, or building ground source systems, which takes advantage of the temperature difference between the underground and surface to heat or cool specific structures and even whole neighborhoods.
Newer techniques seek to drill 3 miles deep and hit what’s called hot rocks, which can be 300 degrees Fahrenheit or more. Operators then pump water down to get turned into steam, which is returned to the surface to power a turbine and generate electricity. The International Energy Agency estimates geothermal has more global generating potential than wind, and nearly as much as solar.
Traditional geothermal power has been concentrated in areas west of the Rocky Mountains, where steam power remains closer to the surface. Hot rock technology puts more areas in play, and with more advances in drilling, potentially creates a national power source. The regions currently in focus include Louisiana, Arkansas, North Dakota, and Texas, not coincidentally areas of existing oil drilling.
Three demonstration projects this year will set the stage for a series of large-scale geothermal wells that will operate like small power plants, including a 3-megawatt energy storage system being developed for the San Miguel Electric Cooperative in Christine, Texas, by startup Sage Geosystems. Ken Wisian, a geophysicist and geologist at the University of Texas at Austin, believes the state could be producing 10% of its power from geothermal within a decade.
Up until about four years ago, the geothermal industry in the U.S. had been flatlining, says Wisian, with little capital investment and no real research, especially compared to the oil and gas industry. At that point, traditional fossil fuel drilling was years ahead of geothermal. But then, drilling firms and startups started applying oil and gas drilling techniques to geothermal, and figured out it’s much more economically viable, in many more places, than originally assumed.
Early leaders, such as Jamie Beard, who gave a TED Talk on geothermal potential, helped instigate a $165 million Department of Energy study to transfer oil and gas tech to geothermal. And the Biden administration helped accelerate the industry, approving projects utilizing public lands and including incentives for geothermal in the Inflation Reduction Act. “Why now? The answer is Trump and ‘drill, baby, drill,’” said Beard, who now leads Project InnerSpace, a private foundation that supports geothermal projects. “Everything we’ve been building for the past five-plus years has prepared us and this ecosystem for this breakout moment. It’s go time.”
As this small niche in energy production—currently just 0.4% of total U.S. generation—expands, Texas has the plurality of startups, university expertise, and multinational oil and gas firms looking to acquire startups and fund promising new drilling technology that they can adopt for their own uses. Mitsubishi Heavy Industries, for instance, has invested in startups that it also hopes become future buyers of its turbines. Add in a proliferation of engineering talent, and there’s a reason most of the industry’s startups call Houston or Austin home.
Startups based in the state have also pushed forward new technology and new methods of drilling. Houston-based Quaise Energy, which has raised $105 million, has developed a high-tech drilling bit that utilizes electromagnetic waves to effectively melt rock. Exceed Geo Energy, based in Austin, recently signed a contract with the Austin Energy utility to develop a 5-megawatt test well. At a time when federal and state lawmakers around the country are lobbying for streamlined well permitting and more money for research, these startups could be poised to lead the nascent industry.
“Houston’s deep ties to the energy sector—especially in drilling, completions, and geosciences—align closely with what it takes to bring enhanced geothermal to market,” said Chelsea Anderson, strategic communications specialist at Houston-based Fervo Energy, which is working on a 400-megawatt project in Utah. “Beyond technical talent, Houston offers a deep bench of professionals with energy sector experience, from supply chain specialists to legal and finance experts, who understand how to scale an energy business. With roughly half of our employees based here, being part of this ecosystem has been invaluable in growing our company.”
Jane Stricker, executive director of the nonprofit Houston Energy Transition Initiative, noted, “Houston has always been an entrepreneurial community of businesses, and I think there has always been an opportunity for folks to come and grow businesses in Houston. I think it has a lot to do with the talent and workforce that is there.”
The Texas Geothermal Energy Alliance (TxGEA), an industry group that has worked closely with the state legislature, has shepherded through a series of bills with broad bipartisan support that, among other things, cleared up geothermal ownership and regulation, and allowed firms to adopt orphan oil and gas wells for geothermal, setting the stage for more commercialization and development. The group sees these laws as a set of model legislation that can be adopted nationwide.
TxGEA’s chairman and founder, Barry Smitherman, says that with large-scale projects soon to be connected to the grid, and advances in drill bit technology (which makes it easy to dig deeper and expand the areas where geothermal is financially feasible) constantly leapfrogging each other, geothermal will quickly become cheaper and more widely available. It helps that these wells, 9 to 12 inches in diameter, don’t take up as much space as sprawling wind and solar farms, and can be drilled closer to power users, requiring less permitting and transmission infrastructure.
“I’ve been a geothermal researcher for 30 years,” said Wisian, the UT-Austin geologist. “This is the most exciting time in the sector by at least an order of magnitude. People smell the money and are starting to pile in.” And it doesn’t stop at utility-scale electricity generation. Wisian ran a pilot project in West Texas and discovered that in areas where it may not get hot enough to generate power, geothermal heat can still be used profitably to warm greenhouses or run air-conditioning for a neighborhood.
Three U.S. military bases in Texas are testing geothermal energy systems for resiliency. And, of course, there are always data centers, ravenous energy consumers that will explode energy demand in the years to come. Fervo has a contract providing geothermal power for a Google data center in Nevada.
Texans also see geothermal as a solid backup, dispatchable power that can be stored for emergencies. After the power failures and fatalities of Winter Storm Uri in 2021, Texas authorities have sought out better storage and backup power options (the Texas Geothermal Alliance formed shortly after the storm). Wisian believes storing heat in wells offers a much more sustainable model than mining, building, and shipping in massive lithium batteries.
His grand vision would be digging a well next to every wind turbine in West Texas and creating a sea of spinning blades and deep tunnels, generating and storing power to help the booming state continue to grow (energy usage here is expected to double by 2030). It’s a big vision, sure, but that seems like the Texas energy model.
Source: https://www.fastcompany.com/91277609/texas-could-be-trumps-one-clean-energy-bright-spot-as-oil-drillers-turn-to-geothermal
