Colorado’s geothermal moment is here
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This story is part of production for a new episode of Colorado Experience focused on hot springs in the state.
PAGOSA SPRINGS, Colo. — Inside an inconspicuous shed off a gravel road in downtown Pagosa Springs lies the inner workings of a unique heating system. One of 23 like it in the country, the system draws heat from hot springs to warm more than 30 buildings, downtown sidewalks and three growing domes.
Pagosa Springs, home to the deepest hot spring in the world, has used its hot springs in this way since the early 1980s.
“The main driver behind it was a result of the oil embargo in the 70s,” said Karl Johnson, the public works director for the town. “It was the first push in the United States, I would say, for renewable energy sources.”
A bipartisan bill awaiting Gov. Jared Polis’ signature paves the way for the future of geothermal use in the state. HB25-1165 is part of the state’s efforts to reach 100% renewable energy use by 2040.
The bill focuses on geothermal energy production and carbon sequestration, two technologies with the potential to combat climate change. Carbon sequestration is the process of capturing carbon dioxide in the air and storing it, usually underground.
Geothermal energy production, meanwhile, uses underground heat to generate electricity.
Sen. Cleave Simpson, a Republican, co-sponsored the bill with three lawmakers from both sides of the aisle. Simpson represents 14 counties in southwest Colorado, many of which are hotbeds for geothermal activity.
“It seems like the state and even the western U.S. is ripe for this kind of conversation and potential development of geothermal,” said Simpson.
Geothermal energy is essentially limitless. The Earth’s core continuously generates and radiates heat outwards, meaning the deeper you dig, the hotter it gets. The rate at which temperatures underground rise can vary based on the geologic activity in the area.
In places like the Rocky Mountains of Colorado, the temperatures underground increase at a quicker rate, meaning developers don’t have to dig as deep to reach at least 360 degrees Fahrenheit needed to produce electricity.
“In general, geothermal is a great resource. You cannot basically deplete it. It's there everywhere. But today geothermal has a very small portfolio,” said Shemin Ge, a hydrologist at CU Boulder. “It's not easy to get, but I think it has potential.”
The excitement and investment in geothermal energy in Colorado picked up over the past few years. Colorado Gov. Jared Polis, a Democrat, launched the "Heat Beneath Our Feet" initiative in 2022 to examine opportunities and barriers to development of geothermal energy technologies.
In 2023, the legislature passed a bill establishing initial pathways for geothermal energy. In 2024, the Energy and Carbon Management Commission released a regulation proposal for the industry in Colorado. And last year, the state offered a series of grants to support geothermal heating or energy projects.
The state awarded grants to 30 geothermal projects around the state, including Pagosa Springs’ heating district. With a combined $300,000 from the grant and the town matching funds, this money will replace old and worn-out pieces of the system.
Part of the challenge for geothermal systems is wear and tear on the infrastructure from the minerals found in the water.
“The components that are in the water — the minerals — depending on what mineral it is, they can calcify,” said Johnson. “You can clog your pumps, you can clog your fittings and the piping system. Some of those minerals are very corrosive depending on the component.”
The initial cost of installing a geothermal system is also a potential barrier. If a new customer wanted to tie into the Pagosa system, Johnson said the tap fee is around $4,000. If a homeowner wanted to install their own heat exchanger, he estimates that would be around $10,000.
However, Johnson pointed out that their current heating grid customers are saving about 30% compared to people who rely on natural gas.
“When they put the system in place, it was for a way to help disadvantaged community members be able to heat their house,” said Johnson.
The heating system in Pagosa Springs is limited in how many people can hook up to the grid. The water flow rate and the 145 degree temperature at which the water comes out of the ground restricts the current system’s abilities. Thirty-three customers are using it now, and Johnson said it could potentially handle up to 40 customers.
The city stress tested the aquifer to determine the true limitations of the system. The test involved letting the water flow uninhibited at multiple wells. While the water table went down, the temperature held steady..
“If you take if you're going to take more than what nature will give you, you can deplete it,” said Johnson.
The presence of artesian water pressure helps make things easier for the heating system in Pagosa Springs. This means the water reaches the surface with a natural pressure as opposed to having to pump the water to the surface.
The artesian pressure is part of what has made Pagosa Springs a hot spot for the development of geothermal energy in town including the three hot springs resorts — The Springs Resort & Spa, Overlook Hot Springs Spa, and Healing Waters Resort and Spa.
“It's a blessing. It's something that we need to take care of,” said Marsha Preuit, former owner of Healing Waters Resort and Spa.
Her family has owned the resort and spa since the 1950s. Preuit took ownership in 1982 and later passed the ownership to her daughter. All resorts in town pull from one big aquifer, but have separate wells where the water comes up. Having lived in Pagosa Springs for 75 years, Preuit hopes people understand overuse could jeopardize the hot springs.
“The water does not belong to us. We are caretakers,” said Preuit. “That reservoir is finite, and if we don't take care of it, the water is going to be gone.”
While the 145 degree water is enough to heat Pagosa Springs’ system, developing a geothermal power plant requires more heat to generate the electricity on a larger scale. This means drilling underground.
In some cases, geothermal plants could use previously drilled locations from old oil and gas operations. In other cases, this would involve drilling into the ground to get to the required temperatures and having to inject a fluid in order to extract the heat.
And the words “drilling” and "injection” will make any hot springs owner’s ears perk up with concern.
“One of the challenges that we also face in our industry is understanding how to best protect our source. So that can come from a water rights issue, from understanding our subsurface,” said Jessica Meath, the executive director of the Hot Springs Association.
Understanding the network of groundwater, faults and water lines isn’t always clear. For example, Pagosa Springs is known for having the deepest hot springs in the world at more than 1,002 feet deep. But it is not known how truly deep that spring goes. That 1,000 foot mark was just the end of the measuring instrument.
However, geologists have developed ways to track underground activity.
“Geologists are pretty magic. They have all kinds of tools,” said Ge. “They have direct tools. They have indirect tools.”
Development has impacted Colorado’s mineral springs, hot springs, and even geothermal caves in the past. In Steamboat Springs, railroad construction in the early 20th century and expansion of Highway 40 in the 1980s changed or killed springs in town.
Colorado is not alone. New Zealand experienced a boom in geothermal energy production in the 1950s and 60s, and now at least 100 geysers have gone extinct from it.
“Geothermal energy exploration may impact hot springs, [it] may not. If we do some studies, we can minimize the impact,” said Ge. “Hot springs definitely need to exist, and I think geothermal energy is also a good thing.”
This bill making its way through the Colorado legislature aims to address concerns from hot springs owners. It requires notification to prior geothermal operators about new well applications within a quarter mile of an existing well, with a chance to request a hearing. It also clarifies management and definitions between Division of Water Resources and the Energy and Carbon Management Commission to streamline the process.
“I think that's a really good step forward,” said Meath. “I think it will really also help better define the risk management that then aligns with some of these policies and permitting requirements.”
For Meath and other Hot Springs Association members, geothermal energy development will be part of their upcoming conference in Glenwood Springs. While most hot springs owners will prioritize the use of geothermal for their pools and spas, new technology has the potential for hot springs owners to use their wells for energy production.
“I think if we just balance applications with information — known information — there could be some really cool, cool things that we see being integrated in the future,” said Meath.
At first mention of this bill, hot spring owners brought many concerns to the House Committee on Energy & Environment during the public comment period. Most of the concerns centered around protecting existing hot springs given their long history and economic benefits the surrounding communities experience.
“You can't really go out on a limb and say it with absolute 100% confidence you can do this without injuring the water right,” said Simpson. “The intention is to make sure that we're taking all the steps, that those existing operations are not impacted at all.”
Simpson is especially sympathetic when it comes to protecting water rights. He is a fourth-generation farmer and rancher in the San Luis Valley with his own water rights. He is also the general manager of the Rio Grande Water Conservation District.
“I rely on snowpack in the San Juan Mountains and a healthier aquifer system and a viable stream flow in the Rio Grande,” said Simpson.
Farming and ranching in the San Luis Valley has also given Simpson first-hand experience of climate change. Following the worst drought in recorded history in 2002, Simpson said they’ve had to change how they farm and survive in that valley.
“The recognition that it's drier, it's warmer, our aquifers are in decline,” said Simpson, “In general, I would think that burning less carbon based fuels has to produce better outcomes. I would like to see us be a lot more thoughtful in how we do that.”
Geothermal energy production could be one of those ways that helps our global climate. In Colorado, that development is getting easier as the bill passed the legislature and waits for the governor’s signature.
“Governor Polis is committed to delivering lower-cost clean energy for Coloradans, including geothermal energy, and this legislation will help us do that and reach our climate goals,” said a spokesperson for the governor.
Type of story: News
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources.
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources.
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