Enel backs Geothermal as world’s cheapest power

Manila Bulletin 
By Alessandra Migliaccio (Bloomberg) 
Published: July 23, 2013 
More than a century ago an Italian prince developed a machine that harnessed the hot air rising from the hills south of Florence to spin a turbine and generate the world’s first geothermal power.
Today, the region better known for Chianti wine than high-technology produces enough power for a million people. That’s helped make Italy Europe’s biggest generator from underground heat, the world’s cheapest source of electricity.
Enel Green Power SpA, which operates the plant, says its experience will give the unit of Italy’s largest utility an edge as it spends 900 million euros ($1.2 billion) in four years to take its technology from Turkey to Peru. Researcher Frost & Sullivan, Inc. expects the global market to grow fivefold to $5.89 billion in the seven years through 2017 as governments cut green subsidies and seek alternatives to wind and solar.
“A lot of people can do solar or wind, but geothermal is quite complex,” Enel Green Power Chief Executive Officer Francesco Starace said in an interview. “The fact that we’re already ahead of others is an advantage. It’s a good hedge against risks for us.”
The most common form of geothermal power costs about $64.20 a megawatt-hour, according to Bloomberg New Energy Finance, below the $78.30 for coal, $82.61 for onshore wind turbines and $142.68 for traditional solar panels.
Worldwide geothermal capacity will probably double by 2030, with the pace of growth accelerating after 2020 as government policies change to promote investment, according to a New Energy Finance report in June. The rising price of electricity and the low cost of geothermal compared with other renewables will make it increasingly attractive, BNEF said.
“In numerous countries across Latin America, East Asia, Southeast Asia, geothermal is not just an option for renewable power but is the least-cost option for power generally, better than coal, gas and hydro,” Mark Taylor, one of the authors, said by e-mail. “If a country has plentiful and powerful geo resources, geo will be highly competitive with all power and generally represent a growth opportunity.”
Globally, 13.2 gigawatts of geothermal projects are in the pipeline, with Israeli developer Ormat Industries Ltd. leading the way, followed by France’s GDF Suez SA and Supreme Energy of Indonesia, according to BNEF.  source