Geothermal Energy: Puga Valley Project, Advantages, Challenges & Potential

GS 3: Infrastructure: Energy; Conservation, Environmental Pollution & Degradation.

Context: In July 2026, Lieutenant Governor of Ladakh, Vinai Kumar Saxena, commissioned India’s first and deepest geothermal wells (GT#02 and GT#03) drilled to a depth of 1,000 meters in Puga Valley, Ladakh. Executed by the ONGC Energy Centre, this achievement paves the way for constructing India’s first 1 MWe pilot geothermal power plant at an extreme altitude of over 14,000 feet.

What is Geothermal Energy?

Geothermal energy is a renewable, clean source of power that utilizes the heat stored beneath the Earth’s surface to generate electricity and supply direct thermal applications.

• Etymology: Derived from Greek Geo (Earth) + Thermal (Heat).
• Key Characteristic: Unlike intermittent solar or wind resources, geothermal energy provides continuous, 24/7 baseload energy.

Sources of Earth’s Internal Heat

1. Residual Heat (Primordial Heat): Heat trapped inside the Earth since its accretion nearly 4.5 billion years ago.
2. Radioactive Decay: Continuous natural decay of long-lived radioisotopes—primarily Uranium (, ), Thorium (), and Potassium ()—in the Earth’s crust and mantle.

How Geothermal Energy is Generated

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1. Extraction: High-pressure steam or superheated fluid is brought to the surface through deep production wells.
2. Power Generation: High-pressure steam expands across a turbine runner connected to a generator to produce power.
3. Re-injection: Spent fluid is pumped back into the deep subsurface reservoir via re-injection wells to maintain reservoir pressures and prevent depletion.

India’s Geothermal Initiative: Puga Valley Project

• Executing Agency: ONGC Energy Centre (backed by a renewed 5-year MoU signed in mid-2026 with the Ladakh Administration).
• Technical Milestones:
  • Two wells reached the targeted 1,000-meter depth.
  • Temperatures exceeding 135°C were recorded at just 400 meters, with higher subsurface thermal indicators deeper down.
  • Operates in hostile terrain above 14,000 feet altitude.
• Capacity: 1 MWe pilot demonstration plant designed to validate commercial scalability in high-altitude environments.

Significance of the Puga Valley Project

• Carbon-Neutral Ladakh: Directly aligns with the national goal of converting Ladakh into a zero-carbon, sustainable region.
• Diesel Displacement: Replaces expensive, high-emission diesel generators used during harsh Himalayan winters.
• Proof of Concept: Serves as a technical blueprint for developing other geothermal provinces across India.
• Strategic Energy Security: Delivers reliable power to remote border zones and civilian settlements without vulnerability to weather fluctuations.

Why Puga Valley? (Geological Context)

• Location: Situated in the Changthang region, Leh district, eastern Ladakh.
• Himalayan Geothermal Belt: Located along the Indus-Yarlung Suture Zone (IYSZ) where the collision between the Indian and Eurasian plates created fractured, highly permeable crust with elevated geothermal gradients.
• Surface Manifestations: Features abundant natural fumaroles (steam vents), mud pools, hot springs, and mineralized sulphur deposits.

Advantages of Geothermal Energy

• Baseload Reliability: Operates with high capacity factors (>90%), unaffected by weather conditions.
• Minimal Footprint: Requires significantly less surface land per megawatt compared to solar, wind, or hydroelectric farms.
• Low Carbon Footprint: Emits negligible greenhouse gases during power operations.
• Direct Thermal Utility: Enables non-power applications such as space heating, greenhouse agriculture, cold storage, and eco-tourism in cold climates.

Global Landscape & Policy Benchmarks

• Global Capacity: Global installed capacity stands under 17 GW, led by the US, Indonesia, and the Philippines.
• Icelandic Model: Iceland generates ~65% of its primary energy and heats ~90% of its homes using geothermal heat, illustrating how long-term policy and geology can decouple an economy from fossil fuels.

Indian Potential & Tech Framework

Potential in India

• According to the Geological Survey of India (GSI), India harbors an estimated 10,600 MW (10.6 GW) of geothermal potential across 381 identified hot spring locations and 10 geothermal provinces (e.g., Himalayan Belt, Cambay Graben, Son-Narmada-Tapti lineament).
• First Operational Micro-Plant: Singareni Collieries Company Limited (SCCL) commissioned a 20 kW pilot plant at Manuguru, Telangana.

Organic Rankine Cycle (ORC)

In medium-to-low temperature systems (<150°C), ORC technology is utilized:

• Thermal fluids heat a secondary working fluid with a much lower boiling point than water (e.g., organic hydrocarbons/refrigerants).
• The vaporized organic fluid drives the expansion turbine, making power generation viable from lower-temperature reservoirs.

Key Challenges

1. High Upfront Capital Costs: Exploration and deep drilling phase costs are capital-intensive (up to ₹36 Crore/MW) with substantial upfront financial risk.
2. Exploration Risk: High uncertainty regarding reservoir temperature, flow rates, and fluid chemistry prior to exploratory drilling.
3. Severe Operational Environments: High altitudes, extreme sub-zero conditions, and short operational windows complicate logistics and equipment life.
4. Subsurface Chemistry: Mineral-rich geothermal brine causes scaling, corrosion, and disposal challenges.

Institutional Framework & Way Forward

• National Policy Support: The National Policy on Geothermal Energy (notified in Sept 2025) provides structured frameworks, allowing 100% FDI, viability gap funding (VGF), and research support via MNRE to lower upfront risk.
• Risk Mitigation Mechanisms: Establish exploratory risk-guarantee funds to offset early-stage drilling failures for private developers.
• Repurposing Assets: Convert abandoned oil and gas wells for low-to-medium enthalpy geothermal extraction.
• Tech Partnerships: Scale bilateral arrangements (e.g., under the US-India Strategic Clean Energy Partnership) to deploy Enhanced Geothermal Systems (EGS) and advanced closed-loop systems.

Conclusion

The successful 1,000-meter well commissioning in Puga Valley turns a long-standing geological potential into active infrastructure. Backed by targeted policy incentives and public-private technology integration, geothermal energy can serve as a dependable cornerstone for India’s 2070 Net Zero target and strategic energy independence.