The Minister for Resources and Energy, Martin Ferguson AM MP, has today opened the Panax geothermal project on South Australia's Limestone Coast.
Panax successfully applied for $7 million under Round 1 of the Australian Government's $50 million Geothermal Drilling Program.
Visiting the site near Penola, Minister Ferguson said South Australia offers great opportunity to develop geothermal energy technology.
"The Panax project is a pioneer in the exploitation of hot sedimentary aquifers in Australia," he said. "It will also test the potential of the Limestone Coast for geothermal development. There is potentially a resource of up to 1500MW available in this region, which importantly, is located close to existing electricity grid connections.
"Preliminary analysis by Geoscience Australia suggests that extraction of one per cent of the energy from Australian geothermal sources could yield 190 million petajoules of energy. This is 26,000 times our primary power usage of 2005.
"Geothermal energy is particularly important because of its potential to supply base-load electricity to the Australian grid from a zero-carbon renewable source. In doing so, it meets our objectives to increase energy security by diversifying energy sources, reduce Australia's greenhouse gas emissions and to supply 20 per cent of Australia's electricity by 2020 from renewable sources."
The Geothermal Drilling Program, with funding of $50 million, is part of the Australian Government's $4.5 billion Clean Energy Initiative. The program supports the cost of geothermal proof-of-concept projects, such as the one near Penola. Proof-of-concept involves measuring the fluid flow between wells to determine the capacity of a potential resource for commercial-scale generation of energy.
Seven successful projects under the program are each receiving grants of $7 million to assist with the high cost of drilling deep geothermal wells.
In addition, two geothermal projects have been successful in their applications for more than $150 million in funding under the $235 million Renewable Energy Demonstration Program. This investment is for the next stage in the process of demonstrating the potential of geothermal energy; the building of demonstration-scale power stations.