More than 128 megawatts of geothermal capacity came on-line in the U.S. in 2012, the second largest annual capacity addition since 2005.

By comparison, the U.S. will install more than three gigawatts of solar this year, and the U.S. wind industry may hit 12 gigawatts. That’s why a developer recently called U.S. geothermal “sort of nichey.”

Competition from historically low natural gas prices was, as one developer put it, “the threat” in 2012. But geothermal leaders expect gas price volatility to end its own threat. Geothermal’s bigger challenge might come from utility-scale solar and wind. Those resources win the majority of utility contracts, though geothermal offers the same long-term price certainty.

In any case, here are the high points of the U.S. geothermal year.

Top Twelve Geothermal Projects

One: Hydroshearing at AltaRockEnergy’s Newberry Crater project in Oregon appeared to be successful. Microseismic events were recorded, indicating hot rock at 500 meters had been fracked with high pressure cold water. Hydroshearing, AltaRockEnergy hopes, will allow control of the seismic activity caused by Enhanced Geothermal System (EGS) fracking. If it proves safety, geothermal would no longer be restricted to conventional hydrothermal wells but could produce anywhere there are hot rocks and water.

Two: U.S. Geothermal Project of the Year award winner Hudson Ranch I was the first plant to go on-line in California’s Salton Sea area in twenty years. Th 49.9-megawatt EnergySource project brought the area’s installed capacity to almost 330 megawatts and renewed interest in its economically recoverable 1,400 megawatt to 2,000 megawatt potential, especially because of the nearby, newly built Sunrise Powerlink transmission line.

Three: Chevron (NYSE:CVX), a silent partner in Hudson Ranch I, announced it would return to active development in the U.S. market and is looking for projects of ten megawatts or more.

Four: Phase one of Ball State University’s $45 million ground-source heat pump (GHP) system went active in 2012. When complete, the system will heat and cool the 5.5 million square feet of Ball State’s 47 buildings, eliminating coal-fired boilers and saving the university $2 million per year.





Technology

Five: Connected to Hudson Ranch I is startup SIMBOL’s demonstration facility for pre-reinjection extraction of precious metals from geothermal brine. SIMBOL’s harvest of a grade of lithium currently available in few other places offers a valuable revenue stream because of lithium’s value in the rapidly expanding electric car battery market.

Six: Geothermal systems are natural sources of greenhouse gas emissions, a 2012 study from the Geothermal Energy Association (GEA) reported as California’s emissions trading market opened, but they contain little carbon dioxide, minute amounts of methane, and little or no nitrogen oxide.

Seven: USGS testing discovered a new type of high-temperature energy reservoir in the Utah-Arizona-Nevada Black Rock desert basin that showed a potential equivalent to California’s Geysers, the Calpine Corp. (NYSE:CPN) fields that produce a third of the world’s geothermal energy.

Eight: The DOE-funded Geothermal Technologies Program offered $1 million awards to each proposal promising to “reduce the levelized cost of electricity from new hydrothermal development to $0.06 per kilowatt-hour by 2020 and Enhanced Geothermal Systems (EGS) to $0.06 per kilowatt-hour by 2030.”

International

Analysts predict the 2012 geothermal marketplace will approach $13 billion. As of May 2012, approximately 11,224 megawatts of installed geothermal power capacity was on-line globally.

According to Ormat Technologies (NYSE:ORA) CEO Dita Bronicki, the major international geothermal markets are still Ethiopia, Kenya and Tanzania in Africa, Indonesia, Japan, and the Philippines in the Asia-Pacific, the Caribbean Islands, El Salvador, and Nicaragua in Central America, Argentina, Chile, and Peru in South America, and Germany, Canada and Turkey.

Nine: In Nicaragua, RAM Power went on-line in phase one of its San Jacinto-Tizate flash steam plant. Phase two may also be in operation by the end of 2012. The site could ultimately produce 270 megawatts for twenty years.

Ten: The U.S. Agency for International Development and the U.S. Geothermal Energy Association launched the two-year, $1.5 million East Africa Geothermal Partnership (EAGP) to help put U.S. geothermal to work developing East Africa’s estimated 10,000 to 15,000 megawatts of potential, and German development agency KfW launched the $67 million East African Geothermal Risk Mitigation Facility, an exploration partnership with the African Union Commission.

Eleven: Japan’s drive to replace its nuclear industry with renewables got boosts, according to the Geothermal Resources Council’s Ian Crawford, when the government approved geothermal exploration in national parks, expected to open 1,000 megawatts of the nation’s 23,000 megawatt potential, and when recreational hot springs owners acknowledged that geothermal, using binary technology that transfers the source water heat to a pressurized working fluid and reinjects the cooled water, does not threaten vital water resources.

Twelve: To reduce dependence on imported natural gas, Western Europe moved toward geothermal energy for heating. A U.K.-Iceland MOU would initiate the building of a sub-North Sea cable, the longest in the world, to deliver Icelandic geothermal resources. Germany, the Netherlands and France also initiated efforts in 2012 to increase use of geothermal heating.