The potential role of data-centres in enabling investment in geothermal energy

Abstract

A techno-economic analysis is presented, of the potential for data-centres and fibre optic networks to drive investment in geothermal resources. The concept is attractive because of data-centres’ stable demand for electricity and refrigeration at a scale of <5MWe, corresponding to the output of a single well doublet; because the cost of establishing a fibre optic link is an order of magnitude less than augmenting an electricity transmission network; and because it offers an opportunity for geothermal systems to compete with the retail price of electricity. A comparison of energy delivery outcomes was performed for both engineered geothermal systems (EGS) and hot sedimentary aquifer (HSA) reservoirs to identify the minimum conditions that could make the concept economically attractive. For the high temperature EGS, a single and dual pressure binary organic Rankine cycle (EGS-ORC, EGS-2×ORC), a single stage flash (EGS-flash) and a hybrid flash-binary system (EGS-hybrid) were studied. The HSA system investigated the direct use (HSA-DU) of the geo-fluid in an absorption chiller for refrigeration and the use of coincidental natural gas resources to deliver electricity via an internal combustion engine. The technical performance of these systems was assessed for a range of well-head pressure (EGS only) and geo-fluid flow rate scenarios. The economic performance of the combined set of investments in optical fibre and energy infrastructure was examined by estimating the expected internal rate of return (E[IRR]). The HSA-DU option yielded an E[IRR] of 14%, following the installation of energy capacity equivalent to the output of one well-doublet assuming the displacement of the Australian retail price of electricity; and 12% for the US retail price. In comparison, the EGS-hybrid was found to have an E[IRR] of 8%, if the Australian retail price were displaced and 4% if the US retail price were displaced. The EGS-flash, ORC and 2×ORC scenarios were found to be progressively less attractive than the EGS-hybrid. To identify the conditions under which the concept could satisfy commercial hurdle rates, the sensitivity of the E[IRR] was investigated for the cost of an optical fibre link; the EGS resource depth; the retail price of electricity displaced; and a data-centres’ energy consumption profile. Credits for CO2 emissions abatement at $23/ton were found to have only a marginal influence on the economic performance of the EGS and HSA scenarios examined.