As researchers unveiled a new report focused on New Mexico’s geothermal potential on Thursday, XGS Energy announced plans to develop a 150 megawatt geothermal closed-cycle facility — meaning the fluid inside is recirculated and not discharged — that will provide electricity to a Meta data center in New Mexico.
New Mexico hopes the XGS announcement is just one of many that will be coming in the future as the state works to craft policies promoting geothermal resources.
The announcement represents a $1 billion partnership and could lead to the creation of 3,000 construction jobs in addition to 100 jobs at the geothermal plant.
While the companies and the state did not disclose where the plant will be located, New Mexico’s Energy, Minerals and Natural Resources Department Secretary Melanie Kenderdine mentioned northwest New Mexico when talking about it during an event in Santa Fe focused on a new 238-page academic report. The report details the state’s geothermal potential and policies that could be adopted to promote the industry.
Officials say geothermal energy is a stable, clean source of power that can provide baseload electricity to balance the fluctuations of wind and solar as New Mexico works to transition away from fossil fuels.
“Incorporating geothermal energy will provide [utilities] with a stable 24/7 power source, reducing dependence on intermittent energy and enhancing grid reliability for our communities,” Sen. Pat Woods, R-Broadview, said.
Tom Solomon, a member of the state’s Geothermal Working Group, said utilities should be considering adding more geothermal to their portfolios.
“It is time for our electric utilities to really start considering geothermal generation as a solid piece of the 100% renewable energy puzzle required by the [Energy Transition Act] in the state,” he said.
The Energy Transition Act requires utilities to transition away from fossil fuels, which means gas-fired power plants will be replaced. Some of those power plants can be found along the Rio Grande Rift, including in the Albuquerque area. Those power plants could be in places with good potential for geothermal development, Solomon said.
“They’re already tied to the grid. The transmission lines are there. The substations are there. The land is there,” he said.
Transitioning a workforce
The type of geothermal being explored in New Mexico uses technology developed in the oil fields including hydraulic fracturing, or fracking. That means people working in the oil and gas industries may be able to transition relatively quickly to working on a geothermal project.
The geothermal potential has aligned interests that are typically opposing parties — environmental advocacy groups and the oil and gas industry.
“We will transition away from oil and gas at some point. We know that, and we’re preparing for that, but to get to a transition, we must first have an energy expansion, and our partnership with geothermal is another way that we get to do that,” Missi Currier, president and CEO of the New Mexico Oil and Gas Association, said.
Currier said the oil and gas industry has expertise that it can lend to the geothermal industry.
“We have gotten really good at digging holes that allow us to pull energy out of the earth,” she said.
The state’s history as an energy pioneer was one reason XGS chose New Mexico, according to Lucy Darago, the company’s chief operating officer.
“New Mexico has been in the forefront of every major wave of energy technology development in the past 100 years,” she said. “That is an incredible legacy, and it speaks to the resources, the people, the education, the culture and the communities here.”
She said the state has an “enormous capacity for innovation and for advancement in a responsible and ambitious way.”
Darago said the announcement Thursday reflects hard work that has been going on behind the scenes for the past few years.
“But today is really also just the beginning,” she said.
NM’s geology and unknowns
Kenderdine said there are five counties in New Mexico that have identified hydrothermal sites and 15 counties that have favorable conditions for geothermal development. Sandoval County is one of the ones that has both favorable geothermal potential and identified hydrothermal sites.
While oil and gas workers may be ideal employees for the burgeoning geothermal industry, the Permian Basin has lower geothermal potential and the San Juan Basin has “medium” geothermal potential. The oil basin that has the best geothermal potential is the Raton Basin, according to Shari Kelley, a geologist with the New Mexico Bureau of Geology and Mineral Resources.
The oil and gas industry has also provided the state with the most detailed information about the subsurface areas of the state. That means the state knows more about the Permian and San Juan than it does about the areas beneath the Rio Grande Rift, which has promising geothermal potential.
Kelley said more information is needed about the subsurface in areas where there is better geothermal potential.
Kenderdine also emphasized the need to better understand New Mexico’s subsurface. She said New Mexico is looking at increased geothermal as well as hydrogen storage and carbon sequestration, which rely on the state’s geology.
“We need to do very, very detailed mapping of New Mexico subsurface,” she said. “And we need to do it quickly.”