illu residential 01

Hot Treasure

Alberta’s unique geothermal potential

By Penney Kome

My favourite garage sale find is a small folk-art sculpture. Bars of beaten copper clasp to form a shimmering triangular tower topped by a pumpjack arm—a tabletop oil derrick. Turn the key on the pumpjack’s wheel and a music box plays “The Impossible Dream.” The pumpjack arm goes up and down but never quite pulls the load from the well.

A lot of Albertans now feel similarly stuck. Our province has a new government and a new climate plan that proposes to change everything, especially for the energy sector. We’re phasing out coal and putting a higher price on carbon. New environmental regulations loom for the energy industry. Oil prices are down sharply as global competitors flood the market. Unemployment is up and corporate revenues are down. Everyone says we must diversify, but no one knows how. A lot of capital is tied up in idle rigs and abandoned wells.

Alberta, however, has the resources, the know-how and the interested parties to create a new energy specialty: geothermal. “To me, this is an exciting opportunity,” says Craig Dunn, the president of Calgary-based Borealis GeoPower. As a geologist, he knows that oilfield wellheads often erupt with brine, oil, gas—and steam. To him that means “Albertans have direct access to the earth’s heat.” What oil companies have long seen as a hazardous nuisance, Dunn’s company sees as a renewable resource that can be turned into a commodity. Already, engineers are retooling oilfield equipment to drill for heat. Even abandoned oil wells can be repurposed for geothermal energy.

Our province also has technical advantages we could sell to the world. Iceland may heat 85 per cent of its buildings with direct geothermal heat, but “they’ve just drilled their first horizontal well,” says Dunn’s colleague Alison Thompson, president of CanGEA, the Canadian Geothermal Association. “We’ve been doing it for years.” Alberta has plenty of drilling rigs on hand, she adds, but “Germany had to build their own.” Another surprising opportunity lies in existing provincial oil well maps, which could reduce geothermal’s exploration expenses, usually one-third of costs.

As Dunn says, “We have some of the smartest people in the world in resource development. We should be using them.” Thompson agrees and puts the situation more provocatively. “Alberta is the biggest geothermal producer in the world,” she says, “but we throw it all away.”

“We’re the biggest geothermal producer in the world,” says Alison Thompson, “but we throw it all away.”

Geothermal has been called the “holy grail” of renewable energy. Clean, stable, emissions-free and long-lived with minimum maintenance, geothermal can also provide stable baseload power that neither solar nor wind can promise. The sun sets and the wind ebbs, but it’s always hot beneath earth’s surface.

Every geothermal method extracts heat from the earth for human use. Even in Alberta’s coldest winters, the ground 3  km beneath our feet is reliably 90–100°C or warmer, due to decaying uranium, thorium and potassium radiogenic rocks. Urban areas such as Calgary have an 8–12°C temperature difference in the first 200 feet of soil.

Engineers apply that heat to a wide range of purposes. They might use heat pumps to stream direct heat from hot springs to nearby buildings. Or they may install smaller, hip-high pumps outside homes, to extract heat air-to-air or ground-to-air. In milder climates, the electricity to run the pump may be the only heating cost.

Bigger buildings or colder climates call for “geoexchange” methods. Here, builders lay flexible pipe loops at some depth in the soil (from one to several metres) and pump water in a constant loop, bringing hot water up and sending cold water back down. Where space is tight, they drill straight down to create boreholes to hold the loops. Compressors leverage the temperature difference to heat or cool buildings. The geothermal grand prize is to capture heat intense enough—such as at a hot springs—to spin a turbine and generate electricity.

As of 2014, 24 countries had geothermal power plants, producing more than 12 GW in total. Eighty countries had projects under development to produce almost another 12  GW. A gigawatt is 1,000 megawatts, and a MW is enough to power about 1,000 homes (at a kilowatt apiece). A gigawatt thus powers a million homes. The US industry was producing about 3.5 GW of geothermal electricity annually by the end of 2014, up from 3 GW in 2010.

Canada has zero geothermal electricity production, either active or underway, despite the best efforts of mainly Alberta-based geoscientists and engineers. Canadians do participate in other countries’ projects, however. CanGEA says Canadian companies produce more than 20 per cent of the world’s geothermal energy. Enbridge owns 40 per cent of the Oregon Neal Hot Springs project, for example, which has been producing geothermal electricity since 2012.

The Geological Survey of Canada estimates that “Canada’s in-place geothermal power exceeds one million times Canada’s current electrical consumption.” Even if only a fraction of this potential is developed, that’s an immense amount of energy.

Like solar panels and windmills (or computers), geothermal technology has evolved from expensive and erratic into relatively accessible and reliable. As equipment improves, engineers are heating or cooling huge spaces using a paltry 10°C temperature difference between the surface and the earth. They’re practically spinning gold from straw.

Homeowners and engineers often use an odd-sounding measure for the geothermal craft, talking about working at several times “100 per cent efficiency.” I heard this phrase from Dale Poloway, proud geothermal homeowner. He uses a monitoring program to calculate his home’s overall efficiency rating—for example, 359 per cent efficiency. For each energy unit put into his system, Poloway’s compressor put more than three and a half times as much energy into heating his home. He estimates his heating costs are about half what they’d be if he used natural gas.

“I’m an early adopter,” says Poloway. “I knew I’d pay a premium for the technology.” He spent three and a half years building a handsome two-storey geothermal house in Calgary’s Inglewood neighbourhood. In his basement, pipes bring up warm water from four 200-foot boreholes to a five-ton heat pump (equivalent to a 50,000 BTU furnace) that captures the heat. The now-cold water goes back down the pipes into the earth to warm up. The pump transfers the captured heat to a circulating system, which runs warmed water through three levels of concrete floors: basement, first and second. Poloway says this system “gives very even temperatures throughout the house.”

The sophisticated Web Energy Logger (WEL) software that monitors his system today displays the results among real time statistics for hundreds of homes across North America at (Poloway’s house is WEL0584.)

Thermal Creek has built dozens of geothermal homes in and near Calgary. While owner Koen van der Maaten has worked on projects as small as a 2,000 ft2 bungalow retrofit, most of his projects are much larger, including a Canmore fourplex and a Calgary MP’s 14,000 ft2 home. Over at Thermal Creek’s website, you can track daily utility activity and costs for a 4,200 ft2 home in Bearspaw. Here, van der Maaten and his crew drilled eight 145-foot boreholes and carved massive channels in the dirt to carry more ground loops. Since 2011 this geothermal system has heated the house and provided hot water without any other heat source—for about $350 a year. Fluctuating fuel costs don’t affect these homeowners.

I’d thought that geoexchange only worked in certain places, but van der Maaten corrected me. “You can do shallow geothermal anywhere on the planet,” he says. “We just finished a project outside Whitehorse, a house on a large piece of land. We buried pipes at about 15 feet deep in 300-foot-long trenches and we’re extracting energy. It all comes down to putting enough pipe in the ground.” He estimates that an average geoexchange system in a new home would cost about $28,000, many times the cost of a typical furnace system. But, then, a geoexchange system doubles as a cooling system too, making it twice as valuable.

What oil companies have seen as a nuisance-hot water-others see as a renewable resource that can be reaped in the form of electricity.

Where geoexchange systems really meet their sweet spot, says Edmonton engineer Jacob Komar, is with commercial buildings. “Commercial buildings achieve economies of scale not available in building a house,” he says. “For instance, the cost per borehole drops. At around 50,000–60,000 ft2, commercial buildings only need a year or two to pay back the cost difference for installing a geothermal system.”

Komar was lead engineer for the Mosaic Centre, a 30,000 ft2 net zero office building completed in 2015 in Edmonton’s Summerside neighbourhood. “Net zero” means that a building consumes no more energy than it produces. “The premium to go geothermal was $80,000,” he says, “which was less than 1 per cent of the Mosaic Centre’s $10.5-million budget.”

Cooling is where geothermal really pays for itself. “We found the Mosaic Centre’s cooling load was greater than its heating load,” he says. “Alberta is a very sunny province. We get a solar load on any south-facing glass. Once the people arrive and the sun heats the glass, the building switches over from heating and starts cooling.”

Here again Alberta has an advantage. Any time you get a large number of people in a building, cooling becomes important. “I’d argue this is the best climate for geothermal on the continent,” says Komar. “In Virginia [where he trained earlier] they’re cooling most of the year, but the geothermal systems are inefficient because the ground temperature is too high to accept the heat the system rejects. In Alberta we can reject heat into the ground with outstanding efficiencies.”

At the University of Alberta, geochemist Jonathan Banks has been working for 10 years to develop the hottest form of geothermal energy: using scalding water to generate electricity. He predicts this could one day be a billion dollar industry in Canada. “Every other nation on the Ring of Fire [the Pacific Ocean perimeter, marked by volcanic activity] has geothermal power,” he says.

With the oil industry in decline, geothermal advocates want to capitalize on all the exploring and drilling already done here. Banks, the lead researcher on an international multi-university project in conjunction with Alberta Innovates–Energy and Environmental Solutions, is using oil company data to find geothermal resources—reservoirs hot enough to drive a turbine. “It’s all public data,” he says. “Whenever a company drills a well in Alberta, they’re obligated to file certain kinds of information with the government, and anyone can have access to that.” Not everyone can interpret the data, though. U of A computers have software that helps interpret the numbers.

Banks’s team is using the data to look for wells filled with water, as happens when a gas field becomes depleted. “We’re looking for reservoirs with temperatures higher than 100°C, which is hot enough to generate electricity,” he says. “Alaska produces electricity at Chena Hot Springs with water at 74°C. One reason they can do that is the air is so cold there, it creates a greater temperature difference, and warmer water vaporizes in the cold.”

Banks is doing the groundwork to make it possible for smaller cities such as Rocky Mountain House to turn nearby geothermal potential into power plants. He has contacted town councils along the eastern edge of the Rockies, from Grande Prairie to Hinton, to point out that they’re very close to excellent geothermal resources—that is, potential riches. “We want the towns to have the information so they can attract investors,” he says. “We’re doing an energy budget for each reservoir, calculating how much energy is in each and how much can be drawn, as well as a precommercialization study for each town.”

Calgary-based CanGEA has also been reviewing data and has put up an online national geothermal database and three provincial favourability maps.

Meanwhile, Borealis Geopower is working on two power-generation projects—Canoe Reach and Lakelse, both in BC. With its exploration permits secured, Borealis is trying to raise funds to identify the precise heat sources. Likewise, DEEP Earth is fundraising to drill exploratory heat wells near Estevan, Saskatchewan.

illu residential 01

Pipes bring hot water from boreholes to a pump, which transfers heat to a circulating system. Water re-enters the earth to warm up.

“We have lots of low-hanging fruit in Alberta,” says CanGEA’s Alison Thompson. “We have thousands of abandoned oil wells that could be topped with geothermal loops and turned into microgenerators.” A series of a dozen or more of these little generators could build up a town-sized load. Others have suggested the mini-generators could produce up to 5 MW each. This could power a town and some light industry.

Speaking to post-secondary geoscience students worried about their career prospects evaporating, Thompson assures them their skills will transfer from oil and gas to geothermal. She says that’s what’s exciting about downturns. “We’re now in a wonderful era of technological innovation. When oil prices are high, all the engineers are busy. When prices drop, we get the benefit of technology transfer.” Necessity: the mother of invention.

What, then, is holding Alberta back? Our province does have some 2,200 geoexchange buildings that draw heat from deep boreholes. But with all of Alberta’s traditional energy advantages—coal, gas, oil, solar and wind—geothermal has been left to slowly grow by itself, without much encouragement, oversight or regulation.

Cost remains the biggest barrier. With federal and provincial governments committed to pursuing renewable energies, “We have a window right now,” Thompson says, “but we have major barriers because we don’t have tax symmetry with other energy industries. We can’t write off dry wells the way oil and gas exploration can.” CanGEA’s research suggests that tax law could be easily amended by adding “geothermal” to the definition of resource exploration and development.

Although home-scale and commercial-scale geoexchange systems have come down in price because they can be mass-produced, geothermal power plants have to be custom-built—and they remain breathtakingly expensive. “Plant cost depends on size,” says Banks. He quotes US estimates of between $3,000 and $4,000 per KW, which works out to $3-million to $4-million per MW. That’s for a standard plant. “For a 1 MW demonstration plant, we estimate costs at $20-million to $25-million. That’s for a prototype,” he hastens to add. “Costs would go down in the future.” In other places, geothermal power has tended to get a foothold and then grow incrementally. The California geothermal field known as The Geysers saw its first small geothermal plant in 1960 and now has 22 power plants which have no fuel costs. That state now produces 4.8 of its energy from geothermal sources.

Cost, however, can be influenced by governments, and not only through carbon taxes and other incentives. “Geothermal energy would be very expensive right now. So? The oil sands were expensive [decades] ago,” says ATB chief economist Todd Hirsch. “The province put public money into researching the oil sands because at first the resource was too marginal for a company to make money on.”

Regulatory changes would help too. “Right now the province recognizes subsurface mineral rights,” Hirsch says. “If you have the leasehold and can prove there are minerals under that land, you can get a loan. Heat isn’t a mineral. It doesn’t count as an asset. The province has to recognize geothermal energy as an asset before the banks will.” A few forward-looking US states do so.

“I’m interested in promoting the idea that Alberta has to look beyond hydrocarbons,” he adds. “We could invest in more solar and wind, but that’s just buying somebody else’s technology. I keep coming back to ‘What kind of technology are we developing here in Alberta?’ Everyone knows the heat is there—it’s not like drilling for oil or gas—but there’s a technical problem with getting at it. Can we apply the bright minds in this province to cracking that nut?

“Alberta’s geology is more typical than the Ring of Fire. If we could solve the technical end, we could sell our technology everywhere that people are trying to get off coal and oil.”

Indeed, heating buildings without creating CO2 emissions would help all countries meet their Paris COP21 goals. Canada is committed to reducing its greenhouse gas emissions to 30 per cent below 2005 levels by 2030. Residential and commercial heating, ventilation and air conditioning generally account for 40–50 per cent of a country’s energy use. Geothermal in every new building would whittle that down.

Post Paris COP21 and post first ministers’ conference, geothermal power is still a sorely overlooked energy source in Canada. Premier Rachel Notley’s plan to phase out coal by 2030 calls for renewables to provide two-thirds of the replacement power, but suggests the emphasis will be mainly wind. The new federal budget gives Natural Resources Canada $82.5-million over two years to research and develop clean energies. But the federal plan for northern Canada—largely dependent on dirty diesel for its heat and electricity needs—notes only wind and solar.

As Hirsch and others point out, our province already excels at exploiting marginal resources. What geothermal advocates want is a bit more government support. With that—like the oil sands—another Alberta billion-dollar industry might not be an impossible dream.

Penney Kome has published six non-fiction books and hundreds of articles. She was editor of, 2004–2013.



Wild Alberta’s Last Stand

The Castle wilderness is our own Costa Rica. Tucked into the southwestern corner of Alberta, the Castle features the largest number of plant and animal species of any region in the province—an island of remarkable biodiversity in a sea of growing industrial and residential development. Which is, of course, why we’ve ...

The Coal Phase-Out

“Jason digs coal.” That’s Jason as in Kenney, the long-serving Conservative MP for Calgary Midnapore, former federal minister and current leader of Alberta’s Progressive Conservatives. Also, depending on whose prognostications you believe, the unstoppable uniter of Alberta’s right and inevitable next premier of Alberta. Last fall Jason’s campaign team took to Facebook ...

Holes in the River

Digging a mine in a river would be stupid, right? Well, in Alberta we do it regularly. Ric Hauer tells the story of a new municipal water well drilled a kilometre away from Montana’s Flathead River. The Flathead, like most Alberta rivers, is what Hauer calls a gravel-bed river. Centuries of ...