Economic Comparison between a Wellhead Geothermal Power Plant and a Traditional Geothermal Power Plant
Author: Carlos Atli Córdova Geirdal
Year: 2013
Supervisors: Supervisors: María Sigríður Guðjónsdóttir & Páll Valdimarsson
Abstract
One of the reasons why geothermal energy is still not used in a larger scale for electricity generation worldwide is that it takes a long time from the time the resource is discovered until the time the power plant is operational. This puts financial pressure on the project, sometimes making it financially not feasible.
The objective of this thesis was to develop a method for geothermal projects where the time until energy production begins, and cash flow starts, is reduced to make more geothermal projects feasible by incorporating the use of smaller wellhead power plants. The focus is on the plant construction stage of the project development.
In this study I defined a hypothetical steamfield, created different scenarios for the steamfield utilization where the advantages of wellhead power plants could be shown, and compared them using the Net Present Value method based on calculations of net power output.
A sensitivity analysis was made where a relevant factor was the time difference (TD) from the moment a wellhead power plant could start to produce energy and the moment a traditional power plant could start to produce energy in a given steamfield.
The main results show that the use of wellhead power plants can have important benefits for a geothermal project, if the time difference (TD) is greater than 12 months the use of wellhead power plants in the early stages of development can increase the NPV of the project, and if the time difference (TD) is greater than 18 months the wellhead power plant can become attractive even as a permanent option.
Link to publication