The geothermal industry may need as much as $73 billion in public financing, almost 10 times current spending levels, to meet developing countries’ electricity targets, according to a new report.
Countries such as Kenya, Papua New Guinea and Indonesia have huge geothermal potential but face challenges attracting capital to develop it. Governments and development banks will have to provide as much as 55 percent of the $133 billion needed to develop the industry to drive sufficient private investment, said the report from San Francisco-based Climate Policy Initiative. Current public investment is $7.4 billion.
If risk-reducing policies are implemented, governments could potentially attract enough private capital to build up geothermal power while spending about two-thirds less than it would cost to construct and operate the projects themselves, the report said.
Countries are collectively aiming to deploy 23 gigawatts of power from geothermal sources by 2030. The world’s largest project to date is the Sarulla power plant in Sumatra, Indonesia, with 330 megawatts.