Part of the solution to California’s ambitious decarbonization goals may, ironically enough, be found in the state’s oil patch.
On a 560-acre plot of land in a dusty portion of the San Joaquin Valley, Premier Resource Management LLC has partnered with some of the nation’s top energy laboratories on a pilot program to take an abandoned oil reservoir and convert it to a geothermal power plant that can also store renewable energy underground for weeks at a time, instead of just a few hours.
The electricity at the site could flow to an already existing substation nearby, with the megawatts then dispersed into California’s power grid.
“It is combining known, existing technologies and processes in a novel way,” said Premier Resource Management’s corporate development officer Mike Umbro, a San Diego resident and one of the company’s founding partners.
The process, called Geological Thermal Energy Storage or GeoTES, would use a combination of techniques both above and below ground such as solar power, heat, and injecting and extracting water from wells.
The project plans to use depleted oil reservoirs at a depth of about 1,200 feet that produce brackish water. The water from the porous, permeable sandstone reservoir will be pumped to the surface and sent into a heat exchanger.
An array of parabolic solar panels that use mirrors to focus sunlight is connected to the heat exchanger. The solar power during the day heats the working fluid to 700 degrees Fahrenheit and the water is sent back to the underground reservoir.
The geothermal heat can be used to turn a steam turbine, generating electricity when the state’s power grid needs it — particularly during evening hours when solar production disappears from California’s resource mix when the sun sets each day.
The closed-loop system envisioned by Premier could also be stored and used later by grid operators.
Most battery storage systems in California in recent years are discharged within four hours. Long-duration batteries, which are currently in development, would discharge within eight hours.
But if the GeoTES pilot program proves to be successful, Umbro predicts the “synthetic geothermal” energy produced at the site can be stored for up to 1,000 hours, or almost six weeks at a time.
Premier Resource executives are confident the technology will work because the reservoirs have been used for similar purposes for decades in Kern County oil and gas fields.
“That’s the exciting part about converting an oil reservoir, which we already know can thermally store the energy,” Umbro said. “It’s a phenomenal opportunity and very scalable.”
Crude oil in California is relatively expensive to produce because it is classified as “heavy” — that is, the oil is richer in carbon and more dense than “light crude” found in other parts of the country.
To loosen thick crude, producers in California’s oil fields often pump steam into the ground so it can rise to the surface.
The thinking goes that 70 years of experience of injecting steam into oil and gas fields can be transferred to processes such as GeoTES — and it’s hoped the switch will be financially practical.
“It really doesn’t require any kind of scientific breakthrough, not like new batteries,” Guangdong Zhu, senior researcher at the National Renewable Energy Laboratory, told monthly business magazine Fast Company.
After connecting to the substation, the demonstration project plans to establish a 10-megawatt commercial power plant around 2027. If all goes well, the pilot program will expand to 400 megawatts about three years later, in 2030.
Umbro anticipates selling power to the state’s grid for four to 12 hours a day.
Since the storage reservoir already exists, Premier executives have targeted a levelized cost of storage at 6 cents per kilowatt-hour — dirt cheap for energy markets in California and states in the West.
The company has partnered with the National Renewable Energy Lab in Colorado, the Lawrence Berkeley National Laboratory in Northern California, the Idaho National Laboratory and the Geothermal Technologies Office at the U.S. Department of Energy.
In addition to integrating all the disparate technical pieces of the project, costs figure to be critical in determining if the pilot is a success or a failure.
The initial demonstration is estimated to come to $18 million and the hoped-for expansion to a 400-megawatt system will require about $2 billion.
Last month, the company received a $6 million award from the Department of Energy.
“With the Department of Energy behind your project, that sends a strong signal to the investment community,” Umbro said.
If the hurdles are cleared, Umbro thinks the GeoTES project will transform the workforce in rural Bakersfield, which is dotted with pump jacks. He estimates there are enough depleted oil reservoirs on the west side of the southern San Joaquin Valley to produce 50,000 to 60,000 megawatts (or 50 to 60 gigawatts) of energy storage.
“It can transition oil field workers for like-for-like jobs in geothermal,” Umbro said. “That’s what’s really exciting — marrying the workforce in the renewable sense as well as the legacy oil and gas workers.”
But the GeoTES project is in its infancy. Premier opened its doors in 2017 and its management team consists of just three full-time employees. The company has hired a roster of about 20 to 30 contracted workers that are employed seasonally.
The project still has a few more permitting hurdles to clear, including approval through the California Environmental Quality Act, or CEQA, for drilling and re-injection of brine water. “I don’t think there’s any question if we’ll get the permits,” Umbro said. “It’s more a question of when.”
According to a company, the project at first plans to drill eight wells on one acre and install solar panels on two acres in 2027. The first commercial expansion will drill 37 geothermal wells and install a 60-acre solar array that will power a 10-megwatt geothermal plant in 2028.
Premier Resource executives say the 560-acre parcel is far enough away from homes that it will not affect the groundwater or water supply of residents.
“The technology demonstration will show we can effectively capture the sunlight, transfer it into the reservoir and store it underground,” Umbro said. “Our big goal is to demonstrate success so that other operators will follow.”
If the project’s dreams are realized, it would mean a considerable boost to the state’s zero-emission portfolio.
California policymakers have set a goal of deriving 100 percent of its electricity from carbon-free sources by 2045, if not sooner.
A 20-year outlook just released by the California Independent System Operator, which manages the power grid for about 80 percent of the state, predicts that 4,000 megawatts of long-duration storage and 5,000 megawatts of “generic clean firm or long-duration storage” will be needed to help meet the 2045 target.
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