With the first global stocktake of progress towards the Paris Agreement targets due to take place later this year at the UAE-hosted United Nations Climate Change Conference (Cop28), we stand at a critical juncture in the fight against climate change.
It is arguably the most important gathering of governments, businesses, civil society and climate experts to date.
It was made very clear at Cop27 in Egypt that much more needs to be done to avoid global warming reaching 1.5C, and clean energy will be key.
While significant progress is being made in developing renewable energy on a large scale, with more than 80 per cent of additional new power capacity commissioned in 2022 from clean energy resources, the vast majority of new capacity is a variable resource.
Storing this electricity is difficult and expensive. This means that most solar and wind energy resources primarily provide power when the sun shines or the wind blows.
Global economies and industries need energy around the clock: we refer to this as baseload sources. Therefore, developing intermittent solar and wind resources alone will not be enough to meet the growing demand for energy and decarbonise our societies.
Fortunately, several solutions to help offset the intermittency of traditional renewables exist. One option is electricity storage technologies, such as Li-ion batteries.
An unsung hero
An unsung hero in the renewables space is geothermal energy. Moving us away from the increasing amount of intermittency in grids globally, due to the rapid addition of renewable capacity, is geothermal energy – an energy source that is baseload, renewable, non-intermittent and, most importantly, clean.
Geothermal energy uses heat from the earth’s core, extracting heat from geothermal reservoirs using wells or other mechanisms. Once at the surface, fluids of various temperatures from the reservoirs can be used to generate electricity as well as serve as a heat source for manufacturing processes, helping to reduce the carbon footprint of heavy industry.
While using geothermal energy to produce electricity is nothing new, having first been discovered more than a century ago, it is still a relatively minor source of renewable energy globally, with only 15GW of global capacity operational. This means there is a tremendous opportunity to expand the use of this resource where available.
In addition to being used to generate electricity and provide heat for manufacturing, geothermal energy can be used to heat and cool buildings through heat pumps and heat facilities through direct-use applications.
Geothermal energy is increasingly becoming a cost-competitive, low-carbon power resource, particularly when considering the relatively high cost of the carbon capture and storage (CCS) technologies required to cut emissions from carbon-intensive electricity generation resources such as coal.
It also offers a higher capacity factor than other renewable energy sources, enabling it to supply baseload electricity whenever required.
And it is an ever-self-replenishing cycle that keeps on going.
The choice of Indonesia to mark our first move into geothermal energy is an extension of our commitment to unlocking the vast clean energy potential that the country holds
While geothermal offers an exciting opportunity to deliver baseload clean energy, countries will require access to global capital and the support of international partners to make projects commercially viable.
We understand this well at Masdar and recently invested in Indonesia’s Pertamina Geothermal Energy – one of the world’s largest geothermal companies – to mark our entry into this technology.
The choice of Indonesia is an extension of our commitment to unlocking the country’s vast clean energy potential. It builds on our existing footprint in Indonesia, which includes Cirata, a 145MW solar photovoltaic (PV) plant and Indonesia’s first floating solar farm.
But Indonesia’s geothermal potential is especially apparent. Indonesia is estimated to hold 40 per cent of the world’s geothermal reserves, with a potential power generation capacity of more than 24GW, making it one of the largest geothermal markets in the world.
And with only 2.8GW of geothermal capacity currently under operation, growing the market represents a significant opportunity – and responsibility.
To scale up geothermal technology in Indonesia and elsewhere, strategic partnerships are critical enablers of success.
Masdar’s recently announced partnership with Adnoc Drilling is a good example of how we are forming partnerships that provide us with the technical expertise required to develop commercially viable solutions and expedite the growth of geothermal energy within the UAE and globally.
While developers like Masdar can support countries with capital and technologies to kickstart the development of geothermal energy programmes, support and investment from the private sector will only be forthcoming if governments and regulators create an environment that is attractive to investors and technology providers. A framework that allows geothermal energy to flourish is key.
More than $130tn of investment in clean energy and sustainable infrastructure is required by 2050 to avert major climate problems. Collaboration between public and private sector stakeholders is critical if real progress is to be achieved in developing a wide pool of cost-effective solutions with a lower carbon footprint.
Geothermal energy offers a proven clean energy solution that can stabilise grids and supports the global journey to net zero. Masdar is committed to enabling the growth of this sector and is always ready to invest in new technologies or solutions that can support countries and our partners in delivering affordable, clean and reliable energy.
Image: Pertamina Geothermal Energy
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