Enhanced Geothermal System Market: Current Analysis and Forecast (2020-2030)

An Enhanced Geothermal System (EGS) produces geothermal power without the requirement for natural convective hydrothermal resources. Traditionally, geothermal energy systems could utilize only resources where naturally occurring heat, water, and rock permeability are sufficient to allow energy extraction. Most geothermal energy is in dry and impermeable rock which conventional geothermal energy systems were not able to extract. EGS technology enhances the existing geothermal resource and can even create a geothermal resource where conventional methods were not effective. EGS achieves this by injecting fluid in rocks where permeability is not sufficient by using various simulation methods such as hydraulic stimulation.

The Enhanced Geothermal System Market is expected to grow at a steady rate of around 6.4% owing to the increasing projects by collaboration from various governments and increasing investments from various industries in the renewable energy sector. EGS technologies can function as baseload resources that produce power 24 hours a day. Unlike hydrothermal energy, EGS can be built anywhere in the world where it is feasible to build depending on the economic limits of drill depth, depending on the economic limits of drill depth. An EGS plant is expected to have an economical lifetime of 20-30 years using current technology. On February 2023, The Department of Energy USA offered 74 million dollars to geothermal pilot projects. The Biden administration office is providing funds to 7 pilot projects to check the economic feasibility of EGS.

Based on Power Station Type, the Enhanced Geothermal System market is segmented into Dry Steam Power Stations, Flash Steam Power Stations, and Binary Cycle Power Stations. The Binary Cycle Power Stations segment accounted for a significant market share, and it is estimated to register substantial growth during the projected timeframe. Binary Cycle Power Station differs from dry steam and flash steam power stations as the geothermal reservoir fluids never encounter the power plant's turbine units. Low-temperature geothermal fluids pass through a heat exchanger with a secondary fluid. According to National Renewable Energy Laboratory In the USA, other than one triple flash plant in 2011, all geothermal capacity additions from 2000 through 2020 have been binary plants. This trend is expected to continue in the USA due to the flexibility of binary technology, which enables the utilization of lower-temperature resources as well as being entirely emission-free.

Based on Depth, the Enhanced Geothermal System market is bifurcated into shallow and deep. Among them, the deep segment captured a significant market share and is expected to grow at a substantial growth rate during the projected period. There is no uniform definition for shallow and deep in the world and it differs in each country. In most countries, the depth separation is regulated by the Mining Act requiring a permit for drilling (mostly between 100 and 400 meters below the surface). The Mining Act influences the drilling market and the depth range.

Based on Simulation Mode, the Enhanced Geothermal System market is segmented into Hydraulic, Chemical, Thermal, and Explosive. The hydraulic segment accounted for a significant market share, and it is estimated to register substantial growth during the projected timeframe. Hydraulic stimulation can be described as the injection of fluids at high flow rates into a reservoir to develop new fractures or reactivate and enhance the hydraulic performance of existing fractures. As the market for enhanced geothermal is still in the early stages, most countries are investing in EGS pilot projects in order to check the feasibility of the project. Countries such as the USA have given huge grants in order to develop EGS which has given a significant boost to the EGS market for the projected period. The longest-operating commercial EGS project currently generating power is the Soultz experimental EGS project in Alsace, France.

For a better understanding of the market adoption of the Enhanced Geothermal System industry, the market is analyzed based on its worldwide presence in the countries such as North and South America (U.S., Mexico, Rest of North and South America), Europe (Germany, U.K., France, Italy, Rest of Europe), Asia-Pacific (Indonesia, India, Australia, Philippines, and Rest of Asia-Pacific), Rest of World. Europe caters extensive share of the Enhanced Geothermal System market and is expected to showcase the highest growth in the Enhanced Geothermal System during the forecast period due to their aggressive investments in the energy sector in order to achieve net zero emission goal of 2050. Europe has invested heavily in the renewable energy sector which includes the geothermal sector, and countries such as Germany, France, and U.K. are focusing on geothermal energy with Germany taking the lead. BloombergNEF estimates that net zero scenario of Europe would see investment of over $3.8 trillion by 2050, with almost 40% of the investment occurring before 2030.

Some of the major players operating in the market include: Enel SpA, Ormat Technologies, Inc., AltaRock Energy, Inc., Royal Dutch Shell Plc, Kenya Electricity Generating Company Limited, BESTEC GmbH, Siemens AG, Fuji Electric Co., Ltd., Calpine Corporation and Energy Development Corporation.