2025 Geothermal Drilling Cost Curves Update

Abstract

Drilling activities account for 30% to 57% of the cost to develop and install a geothermal plant. Therefore, an accurate representation of the cost to drill a well is paramount in techno-economic analysis to determine the feasibility of a geothermal power project. In 2022, the National Renewable Energy Laboratory endeavored to revise the U.S. Department of Energy GeoVision baseline drilling cost curves due to extensive improvement in drilling rates at the Utah Frontier Observatory Research in Geothermal Energy (FORGE) demonstration site. That effort did not culminate in the recommendation of new curves, because the actual project costs did not match the reported performance improvements and were at or above the GeoVision baseline. The need for another iteration of this analysis has arisen from industry record drilling performance reported by recent commercial field-scale and demonstration projects, including Fervo Energy’s Cape Station, the Utah FORGE 16B(78)-32 demonstration, and Geysers Power Company’s GDC-36 demonstration. Therefore, in this work, we have estimated the resulting industry average rate of penetration and bit life and applied these parameters as inputs to the Well Cost Simplified model used in the GeoVision analysis. The revised cost curves show a significant decline compared to the GeoVision baseline. For vertical wells, the magnitude of cost reduction ranges from 12% to 24%, while for horizontal wells, the estimated cost reduction is between 18% and 26%. These revised cost curves align well with actual commercial drilling cost data, and therefore, quantify the economic impact of the utilization of (and advances in) polycrystalline diamond compact bit technology and the application of physics-based methodologies that optimize mechanical specific energy.