Non-Technical Barriers to Geothermal Development in the Western U.S.
hey everyone Thanks for uh joining us we're going to give people a couple minutes to get settled here and then we'll go ahead and get started so we're getting settled in uh you know as we go through our presentations if you have questions please put them in the chat our plan today is to have each of the presenters go through their slides and then take questions at the end of each presentation um and then if we have any time remaining at the end of uh the webinar we can take any additional questions at that time as well so I'm going to go ahead and kick us off here so um my name is Aaron Levine I'm a senior legal and Regulatory Analyst at the national renewable energy lab I've been here for about 11 years working on a number of issues related to renewable energy including geothermal today we're going to be talking about non-technical barriers to geothermal development in both California and Nevada uh for starters I wanted to give just a little background on a department of energy geothermal Technologies office lab call this lab call is was focused on funding opportunities for project proposals on State and local Environmental Management issues these included permitting and from this lab call the geothermal Technologies office selected three projects to investigate state and local Environmental Management issues these Labs the national renewable energy lab the Pacific Northwest National Lab and Idaho National Lab each completed reports in this area the three Labs work together to conduct qualitative interviews with federal state local agencies and project developers and shared information that we collected throughout the process to create consistency throughout our projects um and then from there we really split off and have some distinct focuses of our research analysis and that's what we're going to walk through today um so beginning on the nrel side you know we focused predominantly on non-technical barriers related to Regulatory and permitting as well as what those cost impacts might be some of our key findings included that you know numerous authorities play a role in improving geothermal project development and as a result streamlining and consolidating agency processes and increasing coordination and communication between federal state tribal and or local authorities May decrease project development delays and lower costs yeah in addition we found that there was a number of duplicative federal and state permitting requirements which may increase timelines and these could be seen within both permitting and environmental review processes in California Nevada in some cases in California you may be required to complete both state and federal level environmental reviews where in Nevada we noticed that even when on Federal Land there may be requirements to receive both drilling permits from the state as well as from the Bureau of Land Management at the federal level and these duplicative or lengthy processes can add to the overall timelines for context here's a couple examples within California and Nevada and you can just see um you know the number of agencies involved if you look at the First Column you know you can see that at the uh you know Federal level there's a number of agencies that may be involved through various Federal statutes and then highlight an example at the California state level you can see that once you get into the state processes state and local agencies may also play a number of roles and so um this really highlights the importance of coordination amongst all of these jurisdictional authorities at various levels some of our key takeaways within this space included that you know the numerous federal state tribal and local agencies or authorities are involved in the process and as a result there's a need for coordination across these agencies various mechanisms that we identified that have been used include memorandum of understanding um you know including and uh kind of distinct with the new National renewable energy coordination office that was stood up under the energy Act of 2020 informal working groups that might address specific resource areas or specific issues as well as comprehensive citing processes an example of this was the California energy commission's application for certification process which really ruled all the state level approvals into a single process and issues a single certificate to allow development we also identified a number of key environmental and resource issues in California and Nevada you know sensitive resources on Project sites may require additional analysis and permitting you know both in California and Nevada we saw site-specific challenges due to the presence of sensitive resources which may include species or cultural resources and these ultimately can lead to project delays increase project costs and risks uh within California specifically we were looking at Imperial County and the greater Salton Sea area a number of the areas we identified included Waters of the United States jurisdictional determinations within the Salton Sea area which can add time and um you know previous to being able to apply for a 404 permit from the core and needing that 401 Water Quality certification both under the Clean Water Act from the state a jurisdictional determination is necessary at the outset and we noticed that in multiple instances this has led to a number of delays in the timeline uh you know water quality analysis more broadly in the Salton Sea due to the nature of the resource and then biological species particularly in the sunny Bono National Wildlife Reserve we also noticed you know a number of potential cultural and tribal resource impacts particularly through comments filed on previous environmental review documents I mean ultimately all of these issues play into the NEPA the National Environmental Policy Act and siqua the California Environmental Quality act processing timelines where all these issues need to be documented in some cases medicated or addressed uh similarly in Nevada we saw a number of Environmental and Cultural issues one of the most noteworthy was we were looking in the Dixie Valley region at the Dixie Meadows project site and throughout this process we saw the development of the Dixie Valley toads listing and so this began and ultimately at the conclusion of our report was still subject to a fish and wildlife service emergency listing Under The Endangered Species Act that has since led to a permanent listing for the Dixie Valley toad under the ACT which will now require section 7 compliance Into The Endangered Species Act and this process has led to a number of timeline increases at the project site now we also identified a number of cultural and tribal resource impacts including impacts at the Dixie Hot Springs were you know historically tribes have have used for various reasons and again all these can play into the NEPA processing timelines as the Bureau of Land Management in this case Works to complete you know EAS which took a number of years to complete some of our key takeaways in this area included that comprehensive environmental review documents and Associated landscape level surveys such as looking at cultural or biological resources at a landscape level as opposed to an individual project site can increase certainty around development potential and Associated natural and cultural resource conflicts you know again these could cover large Geographic areas and then tear off of those for individual projects you can potentially have coordination between NEPA and SQL in California to better align federal and state resource concerns and some of these uh Concepts could be used either technology specific such as you know updates to a geothermal programmatic environmental impact statement or could cover multiple Technologies within a geographic area you know we also had a key takeaway of wildest determinations for the Salton Sea comprehensive analysis of what are actually Waters the United States within the Salton Sea could increase certainty and reduce the time spent on individual Lotus determinations occurring on a case-by-case basis and currently the process requires this Waters the United States termination again prior to the state undertaking a 401 Water Quality certification under the Clean Water Act and then the Army Corps of Engineers issuing that 404 permit under the Clean Water Act foreign and then finally I wanted to highlight some of the economic economic impacts of geothermal development timelines and so one area we focused on was trying to identify um you know what these delays could result in in terms of project costs and economic uncertainty as part of this we looked at using our get them tool to understand the Techno economics of geothermal projects and particularly focused on the levelized cost of electricity we looked at these in 4 6 8 10 and 12 year time increments generally we use an eight year as the default timeline for developing a geothermal project this helped us understand what that might look like if you potentially shave four years off that process or add four years off that process under various project scenarios you can see here we looked at this for both Flash and binary technology for hydrothermal ultimately you know we noticed that between the uh the Baseline that we use the eight year timeline you were looking at you know between a one and one and a half cent per kilowatt hour increase um for that cost of electricity when extending the timeline to 12 years and uh similarly you know a half cent to a up to a cent almost decrease um if you move that timeline up to four years and so you can see this window here creates almost a two cents or more than two cents difference in the kilowatt uh cost of electricity in another form you know you can see here just in a plotted graph how this timeline increases the lcoe for both hydro and Flash technology and so with that I'm going to conclude my discussion and happy to take any questions we may have at this time if we don't have any questions this time we can move on to our our next presentation sounds good thanks Aaron can you stop sharing so I can thank you and can you confirm that that's stirring okay yep it looks good great so hey everybody uh good morning or good afternoon my name is Dave Goodman I'm a senior regulatory Analyst at Pacific Northwest National Laboratory and I've been at the lab for about four years uh to start I just want to give thanks to my co-authors Patrick Myrick and Kyle Wilson who did a ton of work on this particularly with the economic model that I'm going to be discussing here today and also want to thank Aaron and team and Harian team for a lot of collaboration coordination as we went through our efforts which were I would say very well aligned with slightly different focuses and I think overall that was a that was a good thing so we have kind of different perspectives and flavors and focus areas but I think that we're a a lot more uh a lot of consistencies throughout the research that we did so first off give just a high level summary of our report that we completed and published last year so Aaron talked somewhat about the Salton Sea in California but had a focus in Nevada as well we focused primarily on the Salton Sea um noting that the salon C has substantial resources and opportunities for development of geothermal but also recognizing that even at this location with the resource potential that exists there the price and cost of geothermal can be higher than other renewable resources such as solar and wind one big thing that we found is that if you add in the potential for co-located lithium and other mineral resource extraction from geothermal brines that can really help to even the playing field so we looked at the history of geothermal development at the Salton Sea and did a comparison to other renewable energy sources in the area which I'll hit in a subsequent slide and then we developed a techno-economic model that we refer to as Mage the model for analysis of geothermal economics to analyze the benefits and costs of various variables relevant to geothermal development and then we provided recommendations for how we could go about streamlining geothermal development at the Salton Sea in particular but with general principles that I think could be applied elsewhere so the slides intended to show information that we found as to the relative costs of geothermal as compared to solar wind and solar with battery backup uh Power purchase agreements represent the actual prices agreed upon in a contract by an energy producer and a buyer so that's a useful metric um so that's one metric that we we looked at and that's the metric that's in the table on the right we also looked at the levelized cost of electricity which is a more complex and holistic estimate that takes into account Capital costs risk and risks and returns capacity Factor efficiencies fuel costs and other factors so as you can see on the table on the right geothermal power purchase agreements have been substantially higher than these other Renewables including solar with the battery backup you can see the mean power purchase agreements from Southwestern States 20 to 24 which you know thermal mean of 71 with the others substantially less than that however we did look into benefits that geothermal presents that may not be factored into these ppas first off a high capacity factor is one substantial benefit and the capacity Factor represents the reliability of a project geothermal is a stable resource that can provide base load power it's not dependent on weather or atmospheric conditions like slope wind and solar can be we found that geothermal can generate about two to four times as much electricity as a wind or solar energy plant of the same installed capacity I will note that battery backup is intended to increase the capacity factor of solar when used and really may represent a more direct competitor to geothermal I will also note that the footprint of geothermal plants is relatively small particularly compared to the large footprint of solar which can require four to eight four to eight Acres or more per megawatt and overall we found that once the factors in the lcoe levelized cost of electricity are considered geothermal is much more competitive with other Renewables than when simply reviewing power purchase agreements and then in the remainder of our report we looked it up you know that notwithstanding we look at opportunities to decrease the lcoe and make geothermal um even more competitive with these uh other Renewables and that's what I'm going to talk about in these subsequent slides so using the techno-economic model that we developed Mage we write the relative sensitivity of various factors that can affect the geothermal lcoe so at the top of the table you can see the factors that had the least impact on the geothermal lcoe and at the bottom you can see the factors that had the greatest impact we'll note that most of these are self-explanatory um one that probably isn't maybe discount rates the discount rate is the opportunity cost that an investor has when lending money higher discount rates are associated with projects with higher risks which will require higher returns to account for the risk lower discount rates represent projects with lower risks so at the Salton Sea we found that there were opportunities to reduce the discount rate based upon a well-characterized geothermal resource relatively low likelihood of drilling failure increasing certainty in construction costs and an increase in chance for timely regulatory approval we found that with all those factors considered that could have a substantial impact in lowering the discount rate and therefore reducing the geothermal lcoe so the next couple slides show some of the other impacting variables on geothermal costs that we looked at certainly federal and state intervention either through the use of tax incentives subsidies loan guarantees or others can have a huge impact in reducing geothermal development and operational costs in this slide on the left show some of the ongoing and potential federal and state processes that may have the potential to reduce the geothermal lcoe even in the past few weeks there have been new exec executive orders like executive order 14096 which has the goal of advancing environmental justice and you know many pieces associated with that and we think there are opportunities there for incentives that um may lead toward increased development of renewable resources like geothermal I would say particularly in underserved and disadvantaged communities like those surrounding the Salton Sea and on the right of the screen there you can take a look at some of these subsidies that we took a look at and we get into a little more detail as to how those may be applicable and how those might affect the lcoe in our report so by far the most impacting variable on the lcoe that we analyzed was co-located lithium extraction so theoretically geothermal and lithium extraction can work symbiotically lithium can be extracted from geothermal brines while geothermal can power the needs of the lithium plant and we're interested in seeing it deployed at a large scale the Hell's Kitchen project in Imperial county is is moving along through the approval process and I think there's a lot of opportunity there and I'm looking forward to seeing that operated and to see how the the co-located lithium and geothermal Works in that process in California the California energy commission has regulatory for permitting geothermal projects and in some cases can Delegate for smaller projects to the county level but the California calcium has regulatory for permitting mineral development including lithium and I just want to note that in order for this process to to work as as best as possible these entities will need to cooperate and work together to ensure effective timely and low risk permitting so finally after using the the Mage model to analyze a number of different variables and focusing specifically on how this could streamline projects at the Salton Sea we concluded our report with some general recommendations that certainly do apply at the Salton Sea but we figure likely to be relevant regardless of the project location and I know that this is in some ways consistent with some of the uh conclusions that Aaron and team uh reached as well uh in general we think these are just um you know good strong best management practices that uh can help to streamline the geothermal development process so with that that's all I have here today um on the slide here you can see a link to our piano report number I think if you Google piano report 32717 uh that would be the first hit there or you're welcome to get in touch with me by either email or phone and I'm not sure if there are any questions but that's all I have for now so thank you hearing no comments I will turn things over to Hari hey thank you so let me share my screen so can you hear very nicely we can hear you okay so my presentation is is it coming nicely or it's not in presentation mode yet okay yeah so I'm gonna just do that that looks good okay thanks so yeah first my name is I work here at Idaho National Lab by training I'm a geochemist geologist and for the last across to 10 years I have been working at inl mostly working on geothermal exploration easiest critical mineral evaluation in geothermal branch warlock interaction thermal energy storage type projects and this is a new project for me and and along with Aaron and Dev we started this project like few years ago and we completed this project like ATIV speaking of 2021 or so and in my presentation mostly I'm I'm just going to include economic impact of Permitting timelines and produce geothermal power in Imperial County so again going back to the Salton City area besides Imperial County we also did some work on Nevada a couple of sites in Nevada and a couple of power plants in in Utah so I'm just gonna so a few numbers from those two Easter Utah I mostly include other most most of my work going to be like from Imperial County in the past mostly Aaron and his group has done a lot of work on these non-technical issues related to geothermal energies and they have identified several barriers to expand markets here of geothermal power and in this presentation so I'm just including pharmaceuts it includes Lan access from YouTube uh to get access to the exploration drilling exploration board holes production Warhols those development activities and timelines to get approval timeline for the environmental reviews for those applications are included in introduce non-technical barrier permit issues and in this study we conducted quantitative analysis of those non-technical barriers impact on the on the costs are produced electricity so my presentation is mostly related to this techno economic analysis and impact our timelines again so I'm just going back to this map uh Imperial County which is located on the Southern California over the years mostly in the late 1970s and early 80s USCS has defined several Casey arrays kgrs means non-geothermal resource areas in this County there are nine kgras here and out of this nine four including Hebrew East Mesa Broly and Salton Sea these are the kg areas that host geothermal power plants and most of the geothermal power plants in this County are are located in this certain sea geothermal areas So currently this area has like 11 power plants in operation one is being planned it's that the CTR that there was mentioned control thermal Association for a project that they are currently working on uh pretty to produce power as well as to extract lithium from the uh brine and this uh besides this non-geothermal cases there is one small geothermal area resource area struck Heaven on the western side of this Southern Sea and as of now format is working on to evaluate resources available in that area and this bar diagram cells when we have the most of the geothermal activities and the part uh geothermal power plus being built so you can see here most of the power plants in this County are built or constructed in the 1980s and 1990s and after that we have very few number of uh development activities uh in that area despite having a lot of resource potential and for our study we were more interested to find the timelines and costs associated with different uh perverty museums that automating starts from getting access to the land to construction of the power plant and transmission lines and throughout that process developers they have to go through a multi-layer permitting process that we apply for access to the land they have to apply to get a permit to to drill some temperature grading wormholes and so forth some of these activities can go in parallel concurrently and sometimes it's a Serial process they can be unprocessed and they move to the other at the end this process takes time and time and cost adds up over time and to complete all this process like it may take several years to several decades so depending on the environmental or cultural issues at the project site uh as Aaron men's and earlier so we conducted a lot of interviews with these stakeholders actually we teamed up so inl pnnl and the other group we coordinated we invited uh stakeholders like developers and Regulatory Agencies uh and we we just did a lot of interviews and throughout that process and data collection process like we identified some of the general issues like uh reconciliation mitigation methods when there is some environmental issues and that area has different jurisdiction for the approval and they come they come up with different mitigation methods and there's some reconciliation has to be done on the matters that are suggested by different Regulatory Agencies it can take time and some of the regulated resources the lacks subject matter experts and it is also a uh a reason to cause a longer permanent timelines and that lack of subject matter experts are mostly due to lots of people from lots of people like to retirement as you saw in the previous slide like most of the geothermal activities were conducted in 80s and 90s and those old folks they retired and these regulated agencies lack subject matter experts and another issues at least like in couple of research areas in Imperial County a fragmented nature of land ownership this is very acute in the truck human areas and there's still the market forces are the biggest hurdle so not favorable lco is compared to solar iron wind obvious hurdle to expand these gfml energy and some of the opportunities like streamlining this process one local state or federal agencies are involved and they have different time other processing times and they have uh different uh her regulated framework and they come up with different ideas and even like sometimes like the the stakeholder most of the developers they want to see some improved interagency relationships to expedite this process and shorten the overall uh permitting timelines so that can help a lot through this geothermal developers in that area and for the Techno economic analysis we developed an Excel workbook so first we collected data from existing power plants that took a lot of effort from just just getting old data was quite difficult and we are able to at least like collect some data that we can use to actually conduct this DEA for a couple of sites Second Step was to make some necessary assumptions for example the lifetime of the power plant was as soon to be 30 years and we adjusted all the cost associated with application to construction of a power plant and transmit some of those things to the dollar amount of the project completion year uh we assume like uh interest rate on all spell costs around six percent and the capacity Factor we use 70 this is uh on the lower side I saw a debuts nine percent and the 30 is mostly influenced by the older uh geothermal Technologies but it's just like in our case like we use 70 so and third step which is just the calculations we use the simplified Coe to calculate these numbers so if you need more detail on how to calculate or what this means I refer you to the low in 2020 paper and some of the earlier calculations were done at the unreal they also use uh this simplified LCL and to compare uh the LCA for one plan to the other or one scenario to the other if it's like uh we feel like this is a good uh parameters then the last one we did calculation with the potential ligand or Miss Revenue this get our missed Revenue represent the aggregated revenues being generated or not generated from the produced or not produce electricity we wanted to see uh that we wanted to come here so from one scenario to the other for this we needed to create a hypothetical plant geothermal project insultancy that has been subject to different environmental review and permitting scenarios and we just compare them reach out from different scenarios and as I mentioned earlier so we uh so we did some work on the Utah and Nevada and on the Imperial County for this person and one this one is the actual built geothermal power plant kgra and we did the calculation with 9112 that's the lcoe per megawatt hour and that is what Arsen runs too so they accomplished all the regular the permitting process that drilled a couple of uh geothermal Wells and they Define the resource was not there and for that uh project we use the cost of the plant uh similar to horse and one and did the calculations inside this one is slightly uh higher in the lco it can be this the arsenet won't we do similar calculations for cook fork in Utah and salt Wells you know so you can see here the LCA values for Nevada and Utah are quite less compared to this uh Imperial County project uh this one was mostly due to the higher cost Associated to associate with the construction of power plant in insultancy area because of the hyper cell line nature of the digital bride so the brine is very corrosive they and costly to build and that has a significant impact on the Belgium for these two projects and we for two yeah so to compare the are the two tests be sensitivity permanent timelines on the lcoe we created a hypothetical project and we subject that project into five different Environmental Management review scenarios so these are mostly these scenarios are very similar to the scenarios that geovision mostly the Aeron and his group put together for the geovision histories with scenario a in this case the area has a land use plan also they has programmatic environmental impact statement and if that area has no environmental or cultural issues so that project could go through this scenario a uh permitting timelines and so from Scenario a to E the scenario is more complicated taking more time and we did calculated the timelines to complete the project for scenario a b c d and e so just assuming uh this same hypothetical project was being subjected to to these different scenarios and for the general data we use uh CDR that control thermals such as project ongoing project that project and this hypothetical project has similar uh development instances as of that ctrs project so they list 100 1000 acres of land from IID that Imperial Irrigation District for 30 years with different leads rent rate all those things and they applied for the cop that's the conditional use Department to the county and it got apparently different scenarios and they evaluate the resource and it was deemed uh a Bible and they had this utilized and conditional is permit and they they got the approval uh in each different review scenarios and the project was for 50 megawatt per plant with a car similar to the horse and events so this data provided us all the background data we needed for us to conduct the uh tea and I'm gonna I'm just gonna have a very briefly here so with scenario a they could start and complete the project in six years and the scenario will be uh they could finish the project in 18 years and scenario see nine years and for the scenario the 13 years we did not do the scenario a and this one gives the cost associated with different activities here so the important ones are this lcoe with scenario a H lcoe is 103 dollar per megawatt hour with the scenario D that tells like 13 years to complete uh the LCA is 114 dollars and assuming the scenario as an ideal uh scenario of the e c and d uh would miss a significant amount of Revenue over the years so from like 60 or more than 60 million to more than 200 million dollars if that project was subject to scenario D permanent timelines so in conclusion development of geothermal research requires multi-layer regulatory permitting by local state and federal agencies we Collective property and development related data for several sites but we we created a hypothetical geothermal power plant development in certainty KCRA that are subject to for review and formatic scenarios the fastest timeline would have the project completed in six years in contrast the longest permitting timelines would need like 13 years to complete that project and the longer timelines the seoa values with longer timelines were almost like four to eleven percent higher than the shortest one and the the potential loss of revenue from delayed completion of project would range from 64 to over 200 million dollar loss in Revenue inefficient and projected permitting processes and in some cases to remind the success of gentlemen project so so the timelines can have like some some quite significant impact uh it's not in the lcaue but in the last revenue and you can create a problem for the uh getting a lender that project being successful successful and I like to turn like doe GTO for sampling this and Aaron and Dev also helped during that interview process and we had a lot of uh discussion meeting all those things that actually helped me to to work on this project so that's all any questions well if you don't have any questions we can go ahead and wrap up for the day we will be posting this video recording for others to view at a later date and we'll be sharing that information out once that's available other than that thank you to both our presenters from pinonel and inl as well as those who attended today and the geothermal Technologies office for funding support thank you yep thank you all have a good day okay thank you
2023-06-22 12:05
