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Measuring the Economic, Environmental, and Social Benefits of Nine Geothermal Heating System and Power Generation Projec

2. Outline. California Energy Commission (Energy Commission) Geothermal Program studyGeothermal heating system projectsEconomic benefitsEnvironmental benefitsSocial benefitsPower generation projectsEconomic benefitsEnvironmental benefitsConclusion. 3. Energy Commission Geothermal Program study.

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Measuring the Economic, Environmental, and Social Benefits of Nine Geothermal Heating System and Power Generation Projec

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    1. Measuring the Economic, Environmental, and Social Benefits of Nine Geothermal Heating System and Power Generation Projects Liz Battocletti Bob Lawrence & Associates, Inc. Geothermal Resources Council Annual Meeting 13 September 2006 All photos but Fourmile Hill taken by Marilyn Nemzer, Geothermal Education Office. Vic Biswell, Administrator of the Indian Valley Hospital and Medical Clinic, and Dwight Nelson (Maintenance) show the little geothermal pump house on the hospital grounds. Mr. Biswell and his colleagues hope to expand use of the hospital's geothermal to include a new therapeutic bathing facility for clients and for the community. Flow test of Fourmile Hill Exploration Well 88-28A (Photo: Calpine Corporation) Mike Grady, Superintendent/Principal of the Indian Springs Schools shows off the 1600 sq. ft. geothermal-heated greenhouse built with a California Department of Education Healthy Start grant in 2001. The greenhouse enables the school to supply fresh produce for student lunches. In addition, students generate income for the school by using the greenhouse to grow seedlings that are sold to the community and by offering winter-time plant-sitting services. Jason Moeller, Facilities Manager of Surprise Valley Hospital, shows where geothermal fluid is mixed with boiler-heated water and sent to hospital radiators. The hospitals geothermal comes from a nearby well owned and shared by the local elementary school. All photos but Fourmile Hill taken by Marilyn Nemzer, Geothermal Education Office. Vic Biswell, Administrator of the Indian Valley Hospital and Medical Clinic, and Dwight Nelson (Maintenance) show the little geothermal pump house on the hospital grounds. Mr. Biswell and his colleagues hope to expand use of the hospital's geothermal to include a new therapeutic bathing facility for clients and for the community. Flow test of Fourmile Hill Exploration Well 88-28A (Photo: Calpine Corporation) Mike Grady, Superintendent/Principal of the Indian Springs Schools shows off the 1600 sq. ft. geothermal-heated greenhouse built with a California Department of Education Healthy Start grant in 2001. The greenhouse enables the school to supply fresh produce for student lunches. In addition, students generate income for the school by using the greenhouse to grow seedlings that are sold to the community and by offering winter-time plant-sitting services. Jason Moeller, Facilities Manager of Surprise Valley Hospital, shows where geothermal fluid is mixed with boiler-heated water and sent to hospital radiators. The hospitals geothermal comes from a nearby well owned and shared by the local elementary school.

    2. 2 Outline California Energy Commission (Energy Commission) Geothermal Program study Geothermal heating system projects Economic benefits Environmental benefits Social benefits Power generation projects Economic benefits Environmental benefits Conclusion

    3. 3 Energy Commission Geothermal Program study Done for the Energy Commission Geothermal Program. Supported by the U.S. Department of Energy GeoPowering the West Program. Analyzed nine projects: Six geothermal heating systems (GHS); funded since 1981. Three geothermal power generation projects; two funded by the Energy Commission.

    4. 4 Purposes of study Measure how specific projects have benefited from funding received from the Energy Commission Geothermal Resources Development Account (GRDA) and Public Interest Energy Research (PIER) Program; Determine how the Energy Commission Geothermal Programs technical and financial assistanceand the projects it has supportedcontributes to Californias economic, social, and environmental well-being; and Examine the possibility of replicating the Energy Commission funding program in other states.

    5. 5 Location of projects

    6. 6 Geothermal heating system projects Indian Springs School Facilities Indian Valley Hospital and Medical Clinic Modoc High School Facilities San Bernardino District Heating System Surprise Valley District Schools, Hospital, and Clinic Susanville District Heating System

    7. 7 Economic benefits Calculated energy usage and costs without and with the geothermal heating systems. Impossible to obtain precise energy usage and cost data going back over 20 years. Actual data is used when available. No job creation. No increased taxes. Projects did not directly result in job creation; generally the custodian of the pre-existing heating system assumed responsibility for the GHS. Projects did not result in increased tax flows as all six entities are nonprofit. Projects did not directly result in job creation; generally the custodian of the pre-existing heating system assumed responsibility for the GHS. Projects did not result in increased tax flows as all six entities are nonprofit.

    8. 8 Economic benefits The six geothermal heating systems saved $11.1 million in energy costs from 1981 through 2005. Numbers do not tell complete story. Energy Commission funding totaled $7.5 million. Match funding, $1.8 million. Total project costs from all sources was $16.7 million. Combined return on Energy Commission investment was 148%. Average return on Energy Commission investment was 238%. Indian Springs had the shortest simple payback at 6 years; San Bernardino the longest at 432 years. Numbers do not tell complete story. The six geothermal heating systems saved $11.1 million in energy costs from 1981 through 2005. Return on Energy Commission investment is calculated by dividing energy cost savings by Energy Commission funding. Simple payback is calculated by dividing project costs by average savings per year. While easy to compute, simple payback does not include the time value of money, inflation, project lifetime, or operation and maintenance costs. To take these factors into account, a more detailed life-cycle cost analysis must be performed.Energy Commission funding totaled $7.5 million. Match funding, $1.8 million. Total project costs from all sources was $16.7 million. Combined return on Energy Commission investment was 148%. Average return on Energy Commission investment was 238%. Indian Springs had the shortest simple payback at 6 years; San Bernardino the longest at 432 years. Numbers do not tell complete story. The six geothermal heating systems saved $11.1 million in energy costs from 1981 through 2005. Return on Energy Commission investment is calculated by dividing energy cost savings by Energy Commission funding. Simple payback is calculated by dividing project costs by average savings per year. While easy to compute, simple payback does not include the time value of money, inflation, project lifetime, or operation and maintenance costs. To take these factors into account, a more detailed life-cycle cost analysis must be performed.

    9. 9 Energy usage & costs without GHS 51 million kWh electricity 1.5 million gallons of propane 24 million gallons of fuel oil 469 million cubic feet of natural gas Total energy cost: $33 million Mcf = 1000 cubic feetMcf = 1000 cubic feet

    10. 10 Energy usage & costs with GHS 64 million kWh of electricity 456,000 gallons of propane 14 million gallons of fuel oil 546 million cubic feet of natural gas Total energy cost: $22 million

    11. 11 Difference in energy usage & costs with GHS Additional 12 million kWh of electricity 1 million less gallons of propane 10 million less gallons of fuel oil Additional 77 million cubic feet of natural gas Energy cost savings: $11.1 million

    12. 12 Environmental benefits Six geothermal heating systems offset the emissions from the burning of 1 million gallons of propane and 10 million gallons of fuel oil. Greenhouse gas net emissions offset: 148,243 tons of carbon dioxide 4 tons of nitrous oxide Equal to one of the following: 29,353 passenger cars not driven for one year; 15 million gallons of gasoline; 315,369 barrels of oil; 3 million tree seedlings grown for 10 years; or The electricity used by 17,408 households for one year. Environmental benefits were measured by calculating greenhouse gas emissions and air pollutants with and without the geothermal heating systems. From 1981-2005, the geothermal heating systems combined offset the emissions from the burning of 1 million gallons of propane and 10 million gallons of fuel oil. Factoring in the emissions contributed by electricity and natural gas, the six geothermal heating systems have resulted in a net emissions offset of 148,243 tons of carbon dioxide (CO2) and 4 tons of nitrous oxide (N2O)two principal greenhouse gases (GHG). In addition to offsetting GHG emissions, the geothermal heating systems have also prevented the emission of common air pollutants including NOx, various nitrogen oxides produced during combustion; sulfur dioxide (SO2); PM10, a type of particulate matter; and carbon monoxide (CO). Since 1981, the six geothermal heating systems have offset the emission of 264 tons of nitrogen oxides; 1,097 pounds of sulfur dioxide; 1,836 pounds of particulate matter; and 630 tons of carbon monoxide. Good air quality resulting from decreased emissions of air pollutants minimizes the environmental triggers for asthma. The U.S. Environmental Protection Agency estimates that asthma accounts for 1.2 million missed school days per year in Californiathe leading cause of school absenteeism due to a chronic illness. Environmental benefits were measured by calculating greenhouse gas emissions and air pollutants with and without the geothermal heating systems. From 1981-2005, the geothermal heating systems combined offset the emissions from the burning of 1 million gallons of propane and 10 million gallons of fuel oil. Factoring in the emissions contributed by electricity and natural gas, the six geothermal heating systems have resulted in a net emissions offset of 148,243 tons of carbon dioxide (CO2) and 4 tons of nitrous oxide (N2O)two principal greenhouse gases (GHG). In addition to offsetting GHG emissions, the geothermal heating systems have also prevented the emission of common air pollutants including NOx, various nitrogen oxides produced during combustion; sulfur dioxide (SO2); PM10, a type of particulate matter; and carbon monoxide (CO). Since 1981, the six geothermal heating systems have offset the emission of 264 tons of nitrogen oxides; 1,097 pounds of sulfur dioxide; 1,836 pounds of particulate matter; and 630 tons of carbon monoxide. Good air quality resulting from decreased emissions of air pollutants minimizes the environmental triggers for asthma. The U.S. Environmental Protection Agency estimates that asthma accounts for 1.2 million missed school days per year in Californiathe leading cause of school absenteeism due to a chronic illness.

    13. 13 Environmental benefits (contd) Air pollutants not emitted: 264 tons of nitrogen oxides, 1,097 pounds of sulfur dioxide, 1,836 pounds of particulate matter, and 630 tons of carbon monoxide.

    14. 14 Social benefits Difficult to measure quantitatively Demographic indicators: Nearest towns population Median household income Percentage of families living below the poverty level County population County unemployment rates

    15. 15 Social benefits (contd) All nine project sites have median household incomes below the California statewide average of $47,493. All but one of the nine projects have more families living below the poverty level than the California average of 10.6%. The 2005 unemployment rate for seven of the counties in which the projects are located is higher than the States rate of 4.8%.

    16. 16 Social benefits (contd) Being able to share a swimming pool with the community and neighboring school districts year-round. Increasing comfort levels in a school during the cold winter. Allowing the largest employer in a community to stay and provide employment and health care to a community, especially critical in a rural area. Allowing a health care and school district to network and share a renewable resource that touches an entire region. Enabling a school district to divert funds from utility costs to education. Providing a healthier work environment. Examples of improved quality of life.Examples of improved quality of life.

    17. 17 Power generation projects Fourmile Hill Exploration Well 88-28A (2001) Energy Commission: $1.1 million Match: $1.4 million Mammoth Pacific Power Plants I and II Evaporative Cooling (2001) Energy Commission: $100,000 ($900,000 returned) Match: $4.6 million project not completed Salton Sea Unit 6 Energy Commission did not fund MPLP terminated the evaporative cooling pilot project before the end of the grant term. Mechanical differences between G1 and G2 and G3 ...made completing an economic analysis much more time consuming and complex than originally contemplated.64 The company spent only $100,000 of the $1 million PIER grant.MPLP terminated the evaporative cooling pilot project before the end of the grant term. Mechanical differences between G1 and G2 and G3 ...made completing an economic analysis much more time consuming and complex than originally contemplated.64 The company spent only $100,000 of the $1 million PIER grant.

    18. 18 Potential economic benefits 3,175 jobs created. $366 million in direct, indirect, and induced payroll. $353 million in Federal, state, and local income, payroll, and property taxes. $146 million in royalties. Total economic benefit of $866 million or $29 million per year. Over 30 years $366 million in direct, indirect, and induced payroll. $353 million in Federal, state, and local income, payroll, and property taxes. $146 million in royalties $22 million to California $11 million to Siskiyou County $11 million to the Federal Government $40 million to Imperial Irrigation District $62 million to private landowners Total economic benefit of $866 million or $29 million per year. Over 30 years $366 million in direct, indirect, and induced payroll. $353 million in Federal, state, and local income, payroll, and property taxes. $146 million in royalties $22 million to California $11 million to Siskiyou County $11 million to the Federal Government $40 million to Imperial Irrigation District $62 million to private landowners Total economic benefit of $866 million or $29 million per year.

    19. 19 Real & potential environmental benefits Mammoth Pacific has received several awards for its environmental stewardship. Over 30 years, the three geothermal power plants would offset the emissions generated by similar-sized coal-fired and combined-cycle natural gas plants: 32 million tons of carbon dioxide 1,143 tons of nitrogen dioxide 62,644 tons of sulfur dioxide 14,668 tons of particulate matter.

    20. 20 Real & potential environmental benefits (contd) GHG equal to: 6 million passenger cars not driven for one year; 3 billion gallons of gasoline; 67 million barrels of oil; 744 million tree seedlings grown for 10 years; or The electricity used by 3 million households for one year.

    21. 21 Conclusion Over the past 20 years, the six geothermal heating systems have significantly and measurably contributed to the economic, environmental, and social well being of their local regions as well as of California as a whole. Geothermal power plants have an enormous role to play in Californias economic, environmental, and social well-being.

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