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Geothermal energy is heat derived within the sub-surface of the earth. Water and/or steam carry the geothermal energy to the Earth’s surface. Depending on its characteristics, geothermal energy can be used for heating and cooling purposes or be harnessed to generate clean electricity. However, for electricity, generation high or medium temperature resources are needed, which are usually located close to tectonically active regions.

This key renewable source covers a significant share of electricity demand in countries like Iceland, El Salvador, New Zealand, Kenya, and Philippines and more than 90% of heating demand in Iceland. The main advantages are that it is not depending on weather conditions and has very high capacity factors; for these reasons, geothermal power plants are capable of supplying baseload electricity, as well as providing ancillary services for short and long-term flexibility in some cases.

There are different geothermal technologies with distinct levels of maturity. Technologies for direct uses like district heating, geothermal heat pumps, greenhouses, and for other applications are widely used and can be considered mature. The technology for electricity generation from hydrothermal reservoirs with naturally high permeability is also mature and reliable, and has been operating since 1913. Many of the power plants in operation today are dry steam plants or flash plants (single, double and triple) harnessing temperatures of more than 180°C. However, medium temperature fields are more and more used for electricity generation or for combined heat and power thanks to the development of binary cycle technology, in which geothermal fluid is used via heat exchangers to heat a process fluid in a closed loop. Additionally, new technologies are being developed like Enhanced Geothermal Systems (EGS), which are in the demonstration stage.

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