Geothermal has a problem in that the capital to build a plant is much higher (2-3x) that of a combined cycle natural gas power plant. Even though the fuel is free, in order to make the economics work you have to project power prices out 50 years. Usually when we scope power plants the proformas only go out 15 years.
And by "make the economics work" I'm not talking about excessive returns. I'm talking about a <10% rate of return, getting the investment back in 10-14 years.
It seems like a natural pivot for Alberta, and we spent a lot of sweat trying to convince the government that it was good for drillers. Good for pipefitters and welders and millwrights too. No dice though, if anything I'd say the government actively sabotaged our company (retracted a $7m grant from the previous administration, for example). Just too green for them.
There is a lot of talent available, and one of the drilling companies (Beaver Drilling) has made themselves the spokesman for the geothermal industry. That's what got things moving with at least the government paying lip service to the industry. I left just as Beaver was stepping in, though.
As for costs: so many of the drilling costs are fixed - material costs for casing, consumables like drill bits and drilling slurry. Labor might be down but it's still several million dollars per hole.
If we took a modest chunk out of our defense spending and spent it on this I would think that would be a significant amount of "free" power. A volcanic TVA of sorts.
And by "make the economics work" I'm not talking about excessive returns. I'm talking about a <10% rate of return, getting the investment back in 10-14 years.