NEW YORK (TheStreet) -- The geothermal power community gets no respect since solar and wind tend to steal the public eye when talking about renewable energy. More often than not, people tend to roll their eyes when I say I'm interested in geothermal heat.
Yet, the fact remains, the earth absorbs a whopping 50% of the sun's energy. So is it time to power your portfolio with geothermal energy? I believe so and later I'll tell you which stocks to watch.
For those not familiar with the energy source, a typical geothermal heat pump system benefits from the constant temperature between 50 and 60 degrees Fahrenheit of the upper 10 feet of the Earth's surface to heat a home in the winter, make hot water and produce electricity. At the same time, the system can extract heat from the building and then transfer it back to the relatively cooler ground in the summer.
With a growing movement to adopt more sustainable energy solutions, investors may be interested in knowing geothermal fields produce just one-sixth of the carbon dioxide that a clean natural-gas-fueled power plant produces and is seen by the Environmental Protection Agency as the most efficient, clean and cost effective for temperature control.
The downside to geothermal power is really the fear of the unknown, unwarranted concerns that eventually some tapped locations may cool down and angst associated with tapping these hotspots and releasing toxic fluids (i.e. hydrogen sulfide).
Clearly the latter needs to be examined more, but the good news is more efficient drilling technologies may soon alleviate those concerns at a time when the U.S. is trying to further lower dependence on fossil fuels. That means geothermal power must no longer be viewed as the illegitimate step-child of renewable energy. This point is supported by a smaller footprint to develop geothermal versus solar or wind farms and geothermal being a 24/7 base-load power source that in many cases has generated heat since prehistoric times.
While I'm a huge fan of wind and solar applications, they are intermittent and energy storage solutions are still a concern. This has me thinking there is room for geothermal to wiggle itself into the renewable conversation without the need to depend on storage.
Why now? It is increasingly getting harder and harder to avoid the topic of climate change, so tapping a constant source of power that will generate little if any greenhouse gases is becoming hard to overlook, especially with so much uncertainty regarding the fate of nuclear power in this country.