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Doron Blachar

Doron Blachar

CEO
Ormat Technologies
22 July 2024

Why do we hear more about solar energy and wind energy than geothermal?

The issue lies in how electricity is generated. Solar energy can be harnessed anywhere there is sunlight, as long as you have the right landscape for panels. This accessibility makes solar panels widely available and contributes to their popularity. On the other hand, geothermal energy requires finding a resource deep underground, typically between 1 to 4 kilometers. Once you locate a viable reservoir, you can economically develop it and build a power plant. Building the plant, while complex, is manageable for companies with the necessary expertise. The real challenge with geothermal energy is finding and developing the resource, which is only economically viable in specific regions.

Geothermal resources are abundant in areas such as the western US, Kenya, Hawaii, the Philippines, Indonesia, New Zealand, and around the Ring of Fire. Italy also has geothermal potential, but its resources are usually deep and expensive to access. The availability of geothermal resources is geographically limited compared to solar and wind, making it less prevalent in discussions despite its potential as a reliable, 24/7 energy source.

You mentioned your projects outside of the US, like in New Zealand. How do you see geothermal energy being exploited more efficiently around the world, and what are your plans for this?

Ormat operates in six countries: the US, Kenya, Honduras, Guatemala, Indonesia, and Guadeloupe. We are currently building assets in New Zealand and Dominica, viewing the Caribbean as a significant area for geothermal development. Every country with geothermal resources is eager to develop them. In the US, there's an increasing demand for geothermal energy, particularly in California and Nevada. Indonesia is also heavily investing in geothermal projects. New Zealand has significant geothermal capacity, with approximately1GW capacity operates in NZ and approximately 400 MW supplied by Ormat. Turkey has over 1 gigawatt of geothermal projects, with Ormat playing a major role in supplying technology.

Geothermal potential exists in specific regions in Europe, such as Italy, parts of France, Iceland, and certain areas in Germany. However, outside these regions, geothermal resources are either insufficient or too costly to develop. Our strategy involves focusing on regions with the best geothermal prospects and expanding our presence in those markets.

How problematic is the storage of geothermal energy today, and what is your strategy behind entering the battery storage market?

Geothermal energy, being a 24/7 power source, does not require storage in the same way solar and wind energy do. It provides a consistent supply to the grid, eliminating the need to shift energy between day and night or different weather conditions.

Ormat's primary business remains geothermal, but in 2017, we recognized the growing importance of energy storage due to the increased implementation of solar and wind power. We anticipated that storage would become essential, and we have since developed around 10 storage sites in the US, totaling over 400 MW.

Currently, we are building six more projects, which will significantly increase our storage capacity to over 300 megawatts and one gigawatt-hour. We focus on the US market, particularly in PGM (the east coast), Texas, and California. Our expertise in geothermal has facilitated our expansion into energy storage, leveraging synergies in customer base, transmission lines, interconnections, and permitting processes.

Given your wide-ranging experience, where do you see the climate transition in terms of energy? Are we moving at the right pace with renewable energy sources like solar, wind, and geothermal?

Addressing the climate crisis requires accelerating our transition to renewable energy. Despite the progress, the pace is never fast enough. We must move as quickly as possible towards renewable sources, integrating significant storage capacity to support solar and wind. Developing geothermal energy should also be a priority, although it is geographically limited. Long-term, we need better storage technologies beyond lithium-ion batteries to handle seasonal variations and ensure a stable energy supply.

Battery storage is crucial for the near term, but we need advancements in storage technologies that can efficiently manage energy over longer durations and between seasons. This will involve developing new storage methods and enhancing grid infrastructure to handle the intermittent nature of solar and wind power.

Do you think battery storage is the main focus for the next 20 to 30 years?

In the next 20 to 30 years, we need to develop more cost-effective and efficient storage technologies beyond lithium-ion batteries. Potential advancements could include different types of batteries or entirely new technologies capable of storing electricity for extended periods. Current challenges include high costs and limited storage capacity. Additionally, improving grid interconnections is crucial, although this is also expensive and complex. Overcoming these hurdles will be essential for a stable and sustainable energy future.

What role do you see Ormat playing in the future of energy storage and renewable energy over the next 20 to 30 years?

Ormat is celebrating 60 years next year, having started with a solar project in the 1960s before focusing on geothermal. Looking ahead, geothermal will continue to play a significant role, complemented by solar and storage projects. We are also exploring Enhanced Geothermal Systems (EGS), a technology that involves extracting heat from deep, hot, solid rocks through fracking. Although currently expensive, EGS could become more economical within a decade, allowing for geothermal development in more locations.

Ormat is committed to advancing both geothermal and energy storage technologies, leveraging our expertise to support a more sustainable and resilient energy future. We aim to be at the forefront of integrating these technologies, contributing to the global transition to renewable energy.

What is the realistic solution for energy storage, considering the limitations of current battery technology?

Lithium-ion batteries are effective for short-term storage, but we need solutions for longer durations and seasonal storage. New technologies are being researched to store energy more efficiently and at lower costs. The grid's capacity to interconnect and manage renewable energy is also a critical challenge. Building new transmission lines and improving grid infrastructure are essential, but these are costly and often face public opposition.

In the long term, we need to develop storage technologies that can provide reliable energy during periods without renewable generation, such as rainy days or seasonal changes. These solutions must be both technologically feasible and economically viable. The transition will require a combination of improved storage technologies and enhanced grid capabilities to support the increasing share of renewable energy in the overall energy mix.