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Economic modeling of electricity production from hot dry rock geothermal reservoirs: methodology and analyses. Final report

Description: An analytical methodology is developed for assessing alternative modes of generating electricity from hot dry rock (HDR) geothermal energy sources. The methodology is used in sensitivity analyses to explore relative system economics. The methodology used a computerized, intertemporal optimization model to determine the profit-maximizing design and management of a unified HDR electric power plant with a given set of geologic, engineering, and financial conditions. By iterating this model on price, a levelized busbar cost of electricity is established. By varying the conditions of development, the sensitivity of both optimal management and busbar cost to these conditions are explored. A plausible set of reference case parameters is established at the outset of the sensitivity analyses. This reference case links a multiple-fracture reservoir system to an organic, binary-fluid conversion cycle. A levelized busbar cost of 43.2 mills/kWh ($1978) was determined for the reference case, which had an assumed geothermal gradient of 40/sup 0/C/km, a design well-flow rate of 75 kg/s, an effective heat transfer area per pair of wells of 1.7 x 10/sup 6/ m/sup 2/, and plant design temperature of 160/sup 0/C. Variations in the presumed geothermal gradient, size of the reservoir, drilling costs, real rates of return, and other system parameters yield minimum busbar costs between -40% and +76% of the reference case busbar cost.
Date: September 1, 1979
Creator: Cummings, R.G. & Morris, G.E.
Partner: UNT Libraries Government Documents Department

Economic factors relevant for electric power produced from hot dry rock geothermal resources: a case study for the Fenton Hill, New Mexico, area

Description: The case study described here concerns an HDR system which provides geothermal fluids for a hypothetical electric plant located in the Fenton Hill area in New Mexico's Jemez Mountains. Primary concern is focused on the implications of differing drilling conditions, as reflected by costs, and differing risk environments for the potential commercialization of an HDR system. Drilling costs for best, medium and worst drilling conditions are taken from a recent study of drilling costs for HDR systems. Differing risk environments are represented by differing rate-of-return requirements on stocks and interest on bonds which the HDR system is assumed to pay; rate of return/interest combinations considered are 6%/3%, 9%/6%, 12%/9% and 15%/12%. The method of analysis used here is that of determining the minimum busbar cost for electricity for this case study wherein all costs are expressed in annual equivalent terms. The minimum cost design for the electric generating plant is determined jointly with the minimum cost design for the HDR system. The interdependence between minimum cost designs for the plant and HDR system is given specific attention; the optimum design temperature for the plant is shown here to be lower than one might expect for conventional power plants - in the range 225/sup 0/ to 265/sup 0/C. Major results from the analyses of HDR-produced electricity in the Fenton Hill area are as follows. With real, inflation-free debt/equity rates of 6% and 9%, respectively, the minimum busbar cost is shown to lie in the range 18 to 29 mills/kwh. When real debt/equity rates rise to 12% and 15%, busbar costs rise to 24 to 39 mills/kwh.
Date: December 1, 1979
Creator: Cummings, R.G.; Morris, G.; Arundale, C.J. & Erickson, E.L.
Partner: UNT Libraries Government Documents Department

Power produced from hot dry rock geothermal resources: a case study for the Imperial Valley, California

Description: The case study described here concerns an HDR system which provides geothermal fluids for a hypothetical electric plant located in California's Imperial Valley. Primary concern is focused on the implications of differing drilling conditions, as reflected by costs, and differing risk environments for the potential commercialization of an HDR system. Drilling costs for best, medium and worst drilling conditions are taken from a recent study of drilling costs for HDR systems. Differing risk environments are presented by differing rate of return requirements on stocks and interest on bonds which the HDR system is assumed to pay; rate of return/interest combinations considered are 6%/3%, 9%/6%, 12%/9% and 15%/12%. The method used for analyzing the HDR system involves a two-stage process. In stage 1, the maximum amount that the electric plant can pay to an HDR system for geothermal fluids is calculated for alternative busbar prices of electricity received by the electric plant. In stage 2, costs for the HDR system are calculated under differing assumed risk environments and drilling conditions. These two sets of data may then be used to analyze the minimum busbar price of electricity - which defines a maximum fuel bill that could be paid to the HDR system by the electric plant - which could result in the HDR system's full recouperation of all production and drilling costs.
Date: December 1, 1979
Creator: Cummings, R.G.; Morris, G.E.; Arundale, C.J. & Erickson, E.L.
Partner: UNT Libraries Government Documents Department

Electricity from hot dry rock geothermal energy: technical and economic issues

Description: Extraction of energy from hot dry rock would make available a nearly unlimited energy source. Some of the technical problems and possible economic tradeoffs involved in a power generating system are examined and possible solutions proposed. An intertemporal optimization computer model of electricity production from a hot dry rock geothermal source has been constructed. The effects of reservoir degradation, variable fluid flow rate, and drilling operations are examined to deetermine optimal strategies for reservoir management and necessary conditions for economic feasibility.
Date: January 1, 1979
Creator: Tester, J.W.; Morris, G.E.; Cummings, R.G. & Bivins, R.L.
Partner: UNT Libraries Government Documents Department

Use of hot-dry-rock geothermal resources for space heating: a case study

Description: This study shows that a hot dry rock (HDR) geothermal space heat system proposed for the National Aeronautics and Space Administrations's Wallops Flight Center (WFC) will cost $10.9 million, saving $4.1 million over the existing oil heating system over a 30-yr lifetime. The minimal, economically feasible plan for HDR at WFC is shown to be the design of a single-fracture reservoir using a combined HDR preheat and a final oil burner after the first 4 years of operation. The WFC cost savings generalize and range from $3.1 million to $7.2 million for other HDR sites having geothermal temperature gradients ranging from 25/sup 0/C/km to 40/sup 0/C/km and depths to basement rock of 2400 ft or 5700 ft compared to the 30/sup 0/C/km and 9000 ft to basement rock at WFC.
Date: September 1, 1982
Creator: Cummings, R.G.; Arundale, C.J.; Bivins, R.L.; Burness, H.S.; Drake, R.H. & Norton, R.D.
Partner: UNT Libraries Government Documents Department