Cheapest clean energy?

Geothermal energy is the cheapest form of clean energy coming next to wind energy, says new report from New York University Stern.

Geothermal energy was singled out as the cheapest renewable energy source, and could become competitive with coal and gas-fired power with about $3.3 billion in research and development spending, the report said.

The United States got about 2800 megawatts of geothermal energy in 2006, or 0.3 percent of the total. But it only costs 4 to 6 cents per kilowatt hour to make on average, according to DOE's Energy Efficiency and Renewable Energy division - close to the ultra-cheap price of energy made from coal.

Research into "hot, dry rock" geothermal technology could yield big increases in geothermal energy's potential, the report stated. Most geothermal energy today comes from capturing hot water and steam already underground. Hot dry rock systems, also known as enhanced geothermal systems, seek to inject water from aboveground into wells that reach deep hot, dry rock formations to make steam to drive a turbine and generate power.

This is what Australia plans to capitalize on, as the continent is rich with such rock formations. In the US, Google and General Electric have agreed to work on geothermal together.

An earlier MIT study had said that geothermal is risky; loss of water to the formation, loss of heat over time, dry (cold) holes that are non-productive; difficult drilling conditions (hot etc). As regards the cost, the question is whether the numbers cited includes O&M and if it is over the margin or an average.

Can the earth supply the energy we are looking for?