I’ve got a story in this morning’s Toronto Star about low-temperature geothermal — a.k.a “earth energy systems” or “ground-source heat pumps” or “geoexchange systems” — and rapid sales of the systems in Canada, particularly Ontario. I’ll gloss over the details here, but essentially sales growth of the systems in Canada is in the range of 45 to 55 per cent and far outpaces growth in the United States. Ontario over the past 15 months has outpaced the next closest province, Quebec, by a margin of more than 4 to 1 in terms of residential retrofits. The growth has been so fast that the association representing the industry, the Canadian GeoExchange Coalition, is warning consumers about fly-by-night contractors who aren’t qualified to install the systems but want to ride on the wave of demand.

Perhaps the most interesting comments came from Bruce Ritchey, president and CEO of Indiana-based Waterfurnace Renewable Energy Inc., one of the top sellers of geothermal systems in North America. While overall revenue growth in the company’s last quarter is in the range of 20 per cent, sales to Canada were up about 120 per cent compared to the previous year. In Ontario growth was 200 per cent. Ritchey said sales to Canada have been “phenomenal,” and attributes it to strong government incentives, increased awareness of the technology, and an economy that has been impacted less by the U.S. housing crisis. Of course, rising fuel and electricity prices is also driving sales across the board in all jurisdictions.

Excuse me for a moment while I toot my own horn. Just wanted to point out that Canadian Business magazine has included this blog in its list of “Top 10″ best Web sites for ethical investors. According to the article, by columnist Larry MacDonald, Clean Break is “the exhaustive blog of Toronto Star energy columnist Tyler Hamilton on ‘trends, happenings, and innovation in the clean technology market’ and it comes with plenty of links to clean technology companies, sources and blogs.”

It’s an honour…

A Texas company, Synfuels International, has come up with a way to turn natural gas into gasoline and other liquid fuels that is much cheaper and cleaner than established processes, namely the Fischer-Tropsch approached used since Nazi Germany converted coal and coal-bed methane into diesel fuel back during the Second World War.

Now why would anyone convert natural gas into gasoline? It’s not that all natural gas would undergo this process. The target is natural gas that results as a byproduct of oil extraction in remote locations. Oil companies, more focused on getting at the oil, usually flare or vent natural gas that comes to the surface because it’s too expensive to build a dedicated pipeline that would collect it and send it to market. A lot of this gas is wasted this way. The World Bank estimates about 150 billion cubic meters every year is flared — the combined total gas consumption of France and Germany. The associated greenhouse gas emissions are enormous.

Some, such as BP and Shell, have counted on Fischer-Tropsch plants as a less expensive alternative to building a dedicated natural gas pipeline. The plants would convert the natural gas into gasoline, diesel or jet fuel and transport it by truck/ship, or send it to market inside existing oil pipelines. Unfortunately the cost of Fischer-Tropsch still remains too high. Synfuels hope to change the game, offering plants that have a third the footprint of a Fischer-Tropsch plant but with the same output. “Why use a sledgehammer when you only need a hammer?” said Synfuels president Tom Rolfe. Scientists behind the company figure they can produce, on small scale, a barrel of gasoline from natural gas for about $25, compared to $35 for a Fischer-Tropsch plant benefiting from economies of scale. They also say their plant is cleaner, producing none of the hard waxes, toxic byproducts and other “crud” associated with Fischer-Tropsch.

For a full story on the Synfuels technology check out this article in MIT Technology Review. I don’t typically write about better ways to use fossil fuels, but in this case if we can put more natural gas to use rather than flare/vent it, and at the same time displace the use of oil, then it’s something that should be pursued.

Pacific Gas & Electric Co. announced a deal today that will see it purchase 550 megawatts of solar power capacity from Topaz Solar Farms LLC, a subsidiary of low-key thin-film startup OptiSolar Inc. of California. Another deal, this one with SunPower Corp., involves the purchase of 250 megawatts of solar capacity. Together, the two solar farms are expected to deliver 1.65 billion kilowatt-hours of renewable energy annually to California electricity customers.

“These landmark agreements signal the arrival of utility-scale PV solar power that may be cost-competitive with solar thermal and wind energy,” said PG&E chief operating officer Jack Keenan.

This is a huge boost for OptiSolar, which also plans to build more than 200 megawatts of solar PV in Ontario to take advantage of the province’s 42-cent per kilowatt-hour feed-in tariff. A 500 MW manufacturing plant is being built in Sacramento to supply the modules, and product from OptiSolar’s first but smaller plant in Hayward is already being shipped to projects in Sarnia, Ontario.

OptiSolar executive vice-president Phil Rettger, who is also a company co-founder, said in an interview this afternoon that the deal with PG&E is a clear sign that solar PV has become an economic option at utility scale. “Based on the fact we won these contracts through a competitive bidding process, the market seems to indicate this,” he said. He wouldn’t say how large OptiSolar’s project pipeline has grown, but said the company is in active negotiations.

One interesting point made in the PG&E press release should be highlighted, however: “Both projects are contingent upon the extension of the federal investment tax credit for renewable energy and processes to expedite transmission needs.”

Yet another wake-up call for U.S. federal politicians asleep at the switch.

WaterFurnance Renewable Energy Inc. continues to cut through the U.S. economic downturn like a hot knife through butter. The company, which makes ground-source heat pump systems for homes and businesses, reported today that sales in its second quarter had increased by 21 per cent to $31.3 million and profits jumped 64 per cent to $3.43 million. “Sales in the U.S. residential business were robust despite the slowdown in residential new construction and the tight lending markets,” said CEO Bruce Ritchey. “Our dealers are finding that homeowners are very interested in saving money on their heating and cooling bills and in doing the right thing for the environment.”

In other words, the cost of operating a home — i.e. day-to-day energy costs — is becoming just as important as the cost of the home itself. Low-temperature geothermal is a growth story deserving of more attention.

Geothermal power generation is also showing solid growth, with Santa Rosa, Calif.-based ThermaSource LLC another example of the opportunities ahead. The company announced today it has completed a $41.5 million (U.S.) private equity financing with Riverstone Holdings LLC, US Renewables Group, and Rustic Canyon Partners. ThermaSource is a provider of drilling and engineering services to the geothermal industry. The lack of specialized drilling gear is a huge bottleneck for the market, so companies such as ThermaSource are expanding to meet the demand. The company has raised $93 million in equity and debt over the past two years to fuel its growth. It currently has 210 employees and plans to double that to 420 by year’s end.

For a recent overview of the market — both low-temp and high-temp geothermal — read this recent article in the Chicago Tribune.