What is geothermal energy?
Discover how this clean, renewable energy resource can help reduce the world’s dependence on fossil fuels.
What is geothermal energy?
As people, organizations, and nations look for ways to reduce carbon emissions, governments and companies have stepped forward with important carbon reduction pledges. Finding alternatives to fossil fuels including coal, natural gas, and petroleum are critical to achieving these goals. To that end, renewable cleaner energy sources like solar, hydro, wind, and geothermal are growing in importance.
Today, geothermal energy is considered one of the most efficient and sustainable types of energy because it’s a clean, reliable, and renewable resource. Geothermal energy uses the heat stored inside the earth’s surface to generate electricity and provide geothermal heating and cooling for homes and businesses. Geothermal resources have been in use in North America for more than 10,000 years, as American Paleo-Indians used geothermal hot springs for warmth, cooking, and bathing.
Geography plays a critical role in a region’s ability to take advantage of geothermal energy. The best geothermal resources are commonly located near the boundaries of tectonic plates. Volcanic activity and earthquakes are concentrated near these boundaries due to movement in the earth’s crust. For example, the Ring of Fire around the edges of the Pacific Ocean is a string of volcanoes and seismic activity, primarily caused by plate tectonics. As a result, this region has the most active geothermal areas in the world.
Currently, the United States is the world leader in geothermal energy production, although geothermal energy is just a small percentage of U.S. energy consumption. Because geothermal energy is common near tectonic plate boundaries, most U.S. geothermal power plants are in western states. California has the largest amount of geothermal electric generation capacity with 40 operating geothermal plants.
Iceland, the Philippines, and El Salvador are also geothermal world leaders, with geothermal energy accounting for more than 25 percent of each country’s total energy use.
Read this article to explore geothermal energy, evaluate its pros and cons, and discover geothermal energy examples. You’ll also learn about the future of geothermal energy and how technology can help accelerate geothermal energy innovation.
Types of geothermal energy
Geothermal energy is obtained from the heat generated within the earth. The term “geothermal” comes from the Greek words “geo,” meaning earth, and “thermos,” meaning hot. Below the earth’s crust, which is made up of rocks and water, there’s a layer of hot molten rock called magma. Magma reaches temperatures of 1,300°F to 2,400°F and can bubble to the surface of the earth as lava. Magma also heats rocks and underground layers of water, which can be released through geysers, hot springs, and steam vents—all geothermal energy examples.
However, most of the earth’s geothermal energy remains underground as pockets of steam and hot water and is harvested using various methods:
Low-temperature geothermal energy
- Heat obtained from geothermal fluid close to the earth’s surface rises on its own or is accessed using a well.
- Can be accessed almost anywhere in the world.
- Direct-use geothermal applications including heating homes, greenhouses, fisheries, and some industrial processes.
Co-produced geothermal energy
- Uses water heated as a byproduct from oil and gas wells.
- Generates electricity that’s used by the plant or sold to the grid.
Geothermal heating and cooling
- Geothermal heat pumps are drilled between 10 and 300 feet into the earth.
- Warms homes and buildings in winter and cools them in summer.
Geothermal power plant
- Taps into geothermal reservoirs as deep as two miles in the earth.
- Generates electricity.
Geothermal energy pros and cons
Although geothermal energy is a renewable and clean energy resource, there are disadvantages to it, including high up-front costs and the potential to cause earthquakes and subsidence, the gradual sinking of an area of land.
Geothermal energy pros:
- Environmentally friendly: Geothermal power plants have minimal carbon footprints and the pollution associated with them is very low. Geothermal heating and cooling reduces greenhouse gas emissions.
- Renewable: Unlike fossil fuels, geothermal energy renewable reservoirs within the earth are naturally replenished and will last billions of years.
- Reliable and stable: Unlike wind and solar power, geothermal energy is always available and doesn’t fluctuate. Management can accurately predict the power output from geothermal power plants, which makes them ideal for meeting baseload energy demands.
Geothermal energy cons:
- Environmental side effects: Geothermal energy causes some greenhouse gases below the earth’s surface to escape into the atmosphere. Geothermal power plants can impact the stability of the land and have triggered earthquakes and caused subsidence.
- Management required: Once they’re tapped into by a geothermal power plant, geothermal reservoirs must be properly managed to ensure that they’re not depleted.
- Plants are restricted to specific locations: Geothermal plants can only be built in areas near tectonic plate boundaries, where geothermal reservoirs are available.
Geothermal power plants
Geothermal power plants use high-temperature geothermal resources that come from either dry steam or hot water wells. Similar to drilling for oil, geothermal power plants drill wells deep into the earth. The steam or hot water is pumped to the surface, where it’s used to spin turbines that generate electricity.
There are three types of geothermal power plants:
Dry-steam power plants
Use natural underground sources of steam. The steam travels up to the earth’s surface in the production well, transfers its energy to the turbine, condenses, and is pumped back into the earth or released into the atmosphere. Dry-steam power plants are the oldest type of geothermal plants and are considered the simplest and most effective.
The oldest dry-steam power plant is located in Laredo, Italy. Built in 1911, it continues to supply electricity to more than a million residents. Another important dry-steam power plant is the Geysers Geothermal Resource Area north of San Francisco. It’s been producing electricity since the 1960s and delivers about one-fifth of California’s renewable energy.
Flash-steam power plants
Convert highly pressurized water that’s hotter than 360°F from deep inside the earth into steam. When the hot water reaches the surface, it’s sent to a “flash tank” that’s maintained at a much lower pressure. The reduced pressure causes some water to “flash,” meaning that it quickly evaporates into steam to drive the turbines. Leftover liquid can be flashed again in a second flash tank to extract more energy.
Flash-steam power plants are the most common types of geothermal plants in use today. Iceland, a volcanic island, uses flash-steam geothermal power plants to supply almost all the electricity the country needs. The Philippines, which is located along the Ring of Fire, has the largest flash-steam power plant in the world.
Binary-cycle power plants
Take a different approach to generating heat. They work with highly pressurized water at lower temperatures—between 225°F and 330°F. This method uses a heat exchanger to transfer the heat from the hot water to a secondary fluid, which powers the turbines.
Because moderate-temperature water is more widely available, binary-cycle plants are expected to become the most common type of geothermal power plants in the future.
How is geothermal energy used?
The three most common uses for geothermal energy are direct use, power generation, and ground source heating and cooling.
Geothermal direct-use systems
Tap into naturally heated ground water that’s found a few feet to less than a mile below the earth’s surface. Wells are drilled to extract the ground water, which can be as hot as 200°F or more. In some cases, the hot water or steam might rise up on its own, without the need for active pumping, and can be used directly or cycled through a heat exchanger.
Direct-use geothermal water supports many applications, including warming fishing farms, melting ice and snow on sidewalks and roads, heating large pools, heating buildings, and providing hot water. Although direct-use geothermal systems have lower capital costs than deeper geothermal systems, the technology is limited to areas that have natural bodies of hot groundwater near or at the earth’s surface, such as regions with volcanic or tectonic activity.
Power generation
The three types of geothermal power plants described above tap into geothermal resources deep inside the earth to produce electricity. Most have closed-loop water systems, where they pump the extracted water directly back into the geothermal reservoir after use. Since much of the water has been vaporized into steam, the plants need to re-inject substantial amounts of water to maintain a steady volume of water in the reservoir. Although geothermal energy is a renewable resource that is used in about 20 countries today, most geothermal wells will cool over time, especially when heat is extracted faster than the water is replenished.
Geothermal heating and cooling
Also known as ground source heating and cooling, this is the most common way geothermal energy is used today. To answer the question “what is geothermal heating,” it’s important to understand how a geothermal heat pump (also called a ground source heat pump) works. Instead of generating heat, the pump uses the earth as its heat source and moves the heat around between the earth and the home or building.
The pump is drilled between 10 and 300 feet into the earth and connects to long loops of pipe that circulate liquid underground and throughout the building. In the winter, the liquid absorbs the earth’s heat and carries it into the building, where geothermal heating releases it through a duct system. In the summer, the liquid absorbs the heat in the building and carries it down to the earth for cooling.
More ways geothermal energy is used
- Agriculture uses geothermal energy to keep plants warm in winter by applying steam to the soil.
- Some health spas use geothermal vents to heat their hot tubs and baths.
- Hot springs are known for their therapeutic ability to improve people’s health.
- Natural geysers can be awe-inspiring tourist attractions. “Old Faithful” in Yellowstone National Park is a geothermal wonder that erupts every 60 to 90 minutes and is visited by about 4 million people each year.
The future of geothermal energy
Hydraulic fracking for geothermal energy
In the oil and gas industry, fracking is a common way to increase production. Fracking injects high pressure fluid into rock formations to fracture them and make them permeable. Hydraulic fracking for geothermal energy takes a similar approach and is also referred to as “enhanced geothermal systems” (ESG). Although it’s a similar process to the type of fracking that the natural gas industry uses, there are some important distinctions. Geothermal fracking creates smaller, more controlled fractures and uses fluid that causes much less pollution.
ESG produces steam by extracting energy from rocks that are hot enough, but too dry, to produce steam on their own. Developers drill “injection wells” vertically to depths of about .6 to 2.8 miles into the earth to reach the hot dry rock reservoirs. Then they use high-pressure water or explosives to fracture the rocks and create the geothermal reservoir of fluid. A production well pumps the hot water back up to the earth’s surface, which, similar to binary-cycle plants, warms a secondary fluid that flashes to steam. The geothermal power plant uses the steam to drive the turbines to create electricity.
Barriers to the growth of geothermal energy
- Lack of natural geothermal resources. As discussed in the beginning of this article, the availability of geothermal resources is limited to locations near tectonic plate boundaries. Most countries with access to geothermal energy are already taking advantage of the resource to some extent.
- Geothermal power plant exploration costs and risks. It costs between USD$20 to USD$30 million to conduct an initial exploration and drilling program of three to five geothermal wells. This, coupled with the risk of unsuccessful exploration, are barriers to scaling the use of geothermal energy globally.
- Cost and risk of enhanced geothermal system plants. Although ESG has the potential to expand geothermal resource availability, drilling geothermal wells is very costly compared to drilling for oil or gas. Another barrier is that like traditional “fracking” methods, ESG wells have caused earthquakes. Notably, if the hydraulic fracking takes place close to a pre-existing fault, then there’s a risk of larger earthquakes which might be strong enough to damage nearby buildings.
- High initial cost of geothermal heating and cooling systems. Geothermal heat pumps cost between USD$3,500 to USD$7,500 for a basic unit, and more expensive models with options like hot water heating cost even more. Plus, excavation and installation costs can bring the price up to USD$12,000 to USD$15,000. However, some countries might offer rebates or tax credits to offset some of these costs. These systems do eventually deliver return on investment because they’re very energy efficient. People who invest in geothermal heating and cooling systems can expect to save between 30 to 70 percent of their annual energy bills.
How does geothermal energy affect the environment?
As a clean and renewable resource, geothermal energy is increasingly being viewed as an alternative to fossil fuels. However, geothermal energy does affect the environment in several different ways. Overall, the positive impacts of geothermal energy outweigh the negative.
Negative impacts
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Water consumption
Geothermal power plants consume a lot of water for cooling and to replenish geothermal reservoirs. Of all renewable and non-renewable power plants, geothermal has the second largest water consumption. -
Air emissions
Open-loop geothermal energy plants release hydrogen sulfide, carbon dioxide, ammonia, methane, and boron into the atmosphere. However, most geothermal energy plants are closed-loop systems that inject the gases removed from the back into the earth with minimal air emissions. -
Subsidence
When geothermal power plants extract hot water from deep inside the earth, they leave empty pockets that can subside over time if not replenished. At the surface level, this can impact both the environment and buildings. -
ESG fracking
ESG fracking can induce earthquakes, which is a barrier to adoption for plants located near urban areas, businesses, and homes. In addition, many people believe that ESG fracking has the potential to create negative impacts similar to gas fracking, such as leaks, spills, and soil and groundwater contamination.
Positive impacts
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Low carbon emissions
Compared to most sources of energy, geothermal energy is environmentally friendly. The average geothermal power plant releases an eighth of the carbon emissions released by an average coal plant. -
Reduces dependence on alternative energies
Geothermal energy has the potential to provide a steady reliable source of electricity that can help the United States and other countries transition away from their dependence on fossil fuels and other thermal energies such as propane, natural gas, and oil. Additionally, geothermal power plants do not need fossil fuels to operate. -
Reduces carbon footprints
Geothermal heating and cooling is highly energy efficient. It’s an effective way for people to reduce the carbon footprints of their homes and buildings. For example, geothermal heating and cooling can reduce a home’s greenhouse gas emissions by as much as 75 percent. -
Technologies help drive energy transformation
The world faces an extraordinary challenge to stabilize our climate by building a net zero carbon economy. These innovative technologies are helping to support the global transition to cleaner energy:
Microsoft Cloud for Sustainability
Designed to give organizations the insights they need to record, report, and reduce their environmental impact.
IoT Energy Management
Through IoT energy management, businesses can take pressure off the grid to support their commitment to sustainability by improving energy efficiency and the balance of supply and demand.
Azure IoT
Power providers like ENGIE are using AI and the cloud to boost energy production efficiency while reducing costs.
Quantum Computing
Quantum computing is poised to speed problem-solving around shifting to renewable energy sources like solar, hydro, wind, and geothermal.
Accelerate your sustainability journey
Wherever you are on your path to net zero, Microsoft Cloud for Sustainability enables you to amplify progress and transform your business through environmental, social, and governance (ESG) capabilities.
Frequently asked questions
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Considered one of the most sustainable and efficient types of energy, geothermal energy is a clean, reliable, and renewable resource. It uses the heat stored inside the earth’s surface to generate electricity and provide geothermal heating and cooling for homes and businesses.
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Geothermal energy offers three primary benefits:
- It’s environmentally friendly.
- It’s renewable.
- It’s reliable and stable.
This clean, renewable energy resource can help reduce the world’s dependence on fossil fuels.
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When compared to other sources of energy, geothermal energy has three disadvantages:
- It causes greenhouse gases below the earth’s surface to escape into the atmosphere and may impact the stability of the land.
- Geothermal reservoirs must be managed to ensure that they’re not depleted.
- Geothermal plants can only be built in areas near tectonic plate boundaries, where geothermal reservoirs are available.
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Geothermal energy is used to warm and cool homes, heat greenhouses, support industrial processes, and generate electricity.
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The four types of geothermal energy are:
- Low-temperature geothermal energy.
- Co-produced geothermal energy.
- Geothermal heating and cooling.
- Geothermal power plant.
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