Natural Resources Committee on May 29th, 2018

[Ted Falk, Conservative, Provencher, MB]

Thank you, Ms. Thompson and Mr. Harmer, for coming to committee. Your presentation was very interesting.

You identified three main types of data that you wish somebody would be collecting and assimilating. Is there other data that you think would be important, and is there data in those streams that already exist that isn't being tabulated?

[Alison Thompson]

The oil and gas industry does a great job of measuring depth of well and temperature—so, the bottom hole temperature—and then also things like the permeability or the flow rate. Those would be additional things we could ask the oil and gas industry to share more readily. I don't believe that the mining industry has a necessity to record bottom hole temperature the same way that oil and gas does, and that's a very small change. It certainly would be a burden on the mining industry to ask it to do that, but that one piece of data-gathering would be very useful to people in geothermal.

[Ted Falk, Conservative, Provencher, MB]

How does geothermal electricity compare in cost to other forms?

[Alison Thompson]

The worldwide average for geothermal cost is about $40 per megawatt hour. That's about what Alberta is paying these days or about half of what is paid in British Columbia. It's really because it's a long-life asset. The countries involved, New Zealand and Iceland, and the state of California have been producing for over 50 years. They get to the point where they don't even turn off the machine at the end of life. They'll just refurbish it. It's much like a hydro dam or a nuclear plant in that it has a very long life. As for the operating cost, of course, the fuel is free.

It's very competitive, but you have to get over the idea that drilling wells is risky. So, as opposed to feeling that it's risky, if we could use the data and metadata that's available or at least organized by organizations like the Geological Survey of Canada, we'd be better prospectors ourselves and, obviously, the cost would go down.

[Ted Falk, Conservative, Provencher, MB]

Is that a resource that can be turned on and off at will?

[Alison Thompson]

It really is. The earth is constantly bubbling away and, obviously, you'd be producing your wells. What you may do is still just spin your turbine as opposed to making electricity. You probably would still produce your system, but you wouldn't necessarily have to put it onto the grid. Typically, as an industry, we are base load, and in the merit order—if those are words that you are familiar with—we're actually before coal or hydro. The dams themselves would be batteries, and that's highly valuable to sell into peak markets. You'd run geothermal first and allow organizations like BC Hydro to hold back their dams and sell it strategically into different markets at different times of the day.

[Ted Falk, Conservative, Provencher, MB]

Is there any data that exists today as to how large a resource we have here in Canada?

[Alison Thompson]

We're at least suggesting that there are 5,000 megawatts in Alberta alone. B.C. has several thousand megawatts as well. It really is a very large resource.

However, much like oil and gas, it only exists in certain places, so you really have to match the resource size with where it's needed. I think the heat market.... Heat can be sold anywhere in Canada, but for electricity, you really have to mirror the resource with a transmission line. It becomes costly, of course, if you have a resource in the back 40 and not near a transmission line.

We're very bullish about heat being used everywhere, and about geothermal power being deployed extensively, but in a very focused way.

[Ted Falk, Conservative, Provencher, MB]

Who would you suggest should be the collector and the keeper of the data?

[Alison Thompson]

Right now the Canadian Geothermal Energy Association is, and we're happy to host that. We really feel that we're just a stand-in until the Geological Survey of Canada is provided a mandate. I think they are very keen, especially the Calgary office, to play this role. They have been invited in by industry, but NRCan obviously needs to find the funding and make that part of an official mandate.

[Ted Falk, Conservative, Provencher, MB]

You also indicated that we're one of the only countries, I'm sure we're not the only one, but we're one of the few countries that doesn't have geothermal plants as you're describing. Are there standardized energy data sources out there in other countries of the world that have collected data on their geothermal resources?

[Alison Thompson]

Absolutely. We are actually the last large country...on the Ring of Fire, the volcanic ring that goes around the earth. We hold that distinction, but, again, probably for only one more year. I think the United States is the largest producer of geothermal in the world. They've been at it for well over 50 years. They're the best model for us. They're set up as a Department of Energy, much like we have departments here, that works with the oil and gas and mining industries. We have this data. It's a matter of sharing it and organizing it.

[Ted Falk, Conservative, Provencher, MB]

So there are standard forms already in existence—

[Alison Thompson]

Absolutely.

[Ted Falk, Conservative, Provencher, MB]

—that we could actually piggyback off.

[Alison Thompson]

That's what CanGEA has done. As a private non-profit, we have leveraged those models. We host them in Canada, as a springing-off point, as a best practice.

[Ted Falk, Conservative, Provencher, MB]

Mr. Chair, I'll release my time and give it to Mr. Cannings.

[The Chair, Liberal, James Maloney]

Okay.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you, Mr. Falk.

Thank you for coming here.

This is about data as well as geothermal. You talk a lot about de-risking with sharing of data, and doing research on mapping, etc. A friend of mine, Ross Beaty, was in this business for some time. Eventually, from what I understand, he found it too risky and moved on to other things. What we do here is geothermal not so much from hot points in the earth's mantle, but just warm points that we've already drilled down to. I'm talking about old oil wells, and we hear a lot about orphaned oil wells. I think we've had some people here before the committee, or at least they've met me in my office, who have plans for geothermal from old oil wells. I'm just wondering what the prognosis for that is. It's less risky. The holes are already drilled. It's just a matter of tying them together and getting them on the grid.

[Alison Thompson]

Absolutely. We call that “measured data”. Somebody has already drilled a well, produced it, and collected all the data possible. You can either repurpose that well or drill a brand new one that's more optimized for geothermal production. Oil and gas wells have a certain diameter. No matter how good your reservoir is, you're only going to get a certain amount of energy out of that diameter of well. If you know the resource is there, but drilled a large well, “fit for purpose” for geothermal, you'd be able to have the benefit of that same data, but more extraction of the energy.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

I was under the impression the benefit was the fact the hole had already been drilled—

[Alison Thompson]

The infrastructure, yes.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

—but you're saying the benefit is more that you know what the temperature is down there.

[Alison Thompson]

That's right. It's the confidence in the measured data, because it's been flowed.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

How active is that part of the market in terms of development? Instead of having these hot single points, is there any active interest in more distributed warm points being brought together?