Including Seismic Risk Mitigation Measures Into the LCOE in EGS for Optimal Siting

Abstract

The risk associated with induced seismicity and the cost of mitigation strategies decrease the competitiveness of Enhanced Geothermal Systems (EGS). The most used mitigation strategy, the Traffic Light Systems (TLS), modifies or eventually stops reservoir stimulations as a function of the induced seismic risk. Despite the significant economic consequences of such actions, the direct and indirect costs of TLSs have not been included yet in the Levelized Cost of Electricity (LCOE). In this work, we systematically fill this gap by introducing an analytical geothermal energy model, which evaluates and updates the optimal price of electricity based on TLS mitigation scenarios. The proposed model estimates the production of electricity, the heat credit, and introduces a mitigation cost during the reservoir stimulation based on the probability of dismissing the injection as a function of TLS forecasts. Moreover, during the production phase, the net energy generated is decreased by clipping the production flow rate so that the reservoir's overpressure does not exceed the regional minimum effective stress. While the mitigation cost decreases with the distance between the injection point and exposed building stocks, the operational costs increase with the same distance. Accordingly, we investigate the trade-off between heat credit and seismic risk mitigation cost for the optimal siting of EGS power plant. Finally, we introduce an optimization strategy for analyzing the potential impact of seismic safety standards in determining the number of EGS plants that can be expected in a given region.