The cost-effectiveness of power generation from geothermal potentials in Indonesia and the Philippines

Indonesia and the Philippines offer world-class resources of geothermal energy. Only a small share of their potential is being utilized for power generation today, but geothermal resources could be a cost-effective option for a sustainable future power supply in these countries. To evaluate the economic viability of large-scale integration of geothermal power generation, information on exploitation costs of geothermal potentials are critical. But costs of geothermal projects are quite uncertain and highly depend on the characteristics of the respective geothermal field. Hence, we develop a model to estimate the power generation costs of untapped geothermal potentials in Indonesia and the Philippines, which is based on characteristics of individual potential fields. Furthermore, we derive geothermal cost-supply curves, and integrate them into country-wide power supply optimization models. We analyze the cost-effective expansion of geothermal power supply in Indonesia and the Philippines, applying different levels of CO2 emissions from power generation. Power generation costs of the most economic three quartiles of geothermal potentials only vary moderately, and increase significantly within the fourth quartile. Especially in Indonesia, geothermal energy can be a key resource for replacing coal-fired power generation most cost-effectively by renewable energy sources.