Alberta geothermal industry celebrates federal budget but challenges remain

Advocates of geothermal energy in Alberta are celebrating this week's federal budget, which featurestax incentives for development of the renewable energy, but that push might not be enough to get the industry running at full steam.

"You have to have the investment environment, you have to have the consumer environment, and so I think from our perspective we're really seeing a lot of colliding forces come together," said Sean Collins, president of Terrapin Geothermics.

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The federal budget expanded the types of geothermal projects that can take advantage of tax breaks and incentives.

"We're really happy with it. I think it's one of those things, you're starting to see politicians recognize it," said Collins, who spoke to CBC News during a geothermal conference in Calgary on Thursday.

Oil and gas wells

Some in Alberta have been pushing geothermal as a way to warm buildings or tap into unused oil and gas wells, using the pre-dug holes as a source for equipment to findheatdeep in the earth to help turn turbines for electricity.

"It's one of those few issues that there's not really a political opponent to it because you're putting your traditional oil and gas workers back to work, deploying renewable energy, building local infrastructure so there's not a lot of political opposition to something that just requires a bit of capital foresight and some risk appetite," said Collins.

Not everyone shares hisoptimism, however.

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"To take an old oil well and turn it into a geothermal project, you have to properly decommission what's already there," said oil historian David Finch on the Calgary Eyeopener.

"You still have to do all the cleanup. Then you have to install all the geothermal equipment and this is all very costly."

The costs and challenges

Finch said Alberta is blessed with cheap natural resources like coal, gas and oil, which holds it back when it comes to renewables, and expensive geothermal in particular.

"If it weren't for oil, gas and coal Alberta would be a leader in a lot of these renewables," said Finch.

"Unless some other economic forces come into play, I do not see how geothermal is going to take off in a big way in Alberta."

Even Collins admits there are challenges, including the fact Alberta isn't a hotbed for geothermal activity.

"Alberta, compared to some of the big geothermal producers in the world, does not have a very strong resource," he said.

But he argues theconsistentenergy pulled from ground could help offset the ups and downs of solar and wind.

Finch said what's needed if the industry is to take off is to have an in-depth study of old wells to see how many would be effective and could easily connect to the electricity grid.

That and for the Alberta government to offer policy initiatives and incentives.

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