CARBON dioxide could be stored beneath the Latrobe Valley if a private company's proposal sparks interest from the Federal Government.
Geothermal energy company Greenearth Energy raised the potential for storing carbon below the Valley, while searching for signs of heat or thermal energy.
The company is eager to harness natural, underground heat flows and turn them into energy.
Greenearth Energy has confirmed hot sedimentary aquifers exist deep below the Valley.
However in its quest to find a new power source, the company believes it may have inadvertently discovered vast underground reserves to store carbon dioxide (CO2).
The process of geosequestration involves storing carbon dioxide deep underground.
Research has already identified potential carbon storage sites in Victoria, including areas offshore in the Gippsland Basin.
But the announcement of onshore storage in the Latrobe Valley region was a first.
Greenearth Energy managing director Mark Miller said the discovery could be massive.
``We believe we are onto a breakthrough for ourselves and a double whammy for (the Federal Government) with the economic flow-on of clean renewable power for industry and homes in the Latrobe Valley,'' Mr Miller said.
``Once we have established the existence and the size and the potential of the resource there may be the opportunity for people, not Greenearth Energy, but people to serve and develop the concept of geosequestration of carbon dioxide.
``So our principal business obviously is exploring energy and development of the aquifer systems, but also identifying potential reserves for CO2.''
Mr Miller said Greenearth Energy was still investigating the possibilities of geosequestration but warned for industry not to hold its breath.
``We are a long way off but these systems do exist and what we are saying to people is that they have the right for onshore injection in Gippsland,'' Mr Miller said.
``We are progressing with an application to the Federal Government for funding on the basis for looking for geosequestration in the system and the potential for geosequestration onshore.
``There is no guarantee that it is there but we believe there is potential for further exploration and development.''
Geosequestration plays a pivotal role in the carbon capture and storage (CCS) process.
The process involves capturing carbon dioxide emitted from industry before being injected into the earth.
Loy Yang Power was the first in Australia to successfully capture CO2 from coal-fired electricity generation at its Latrobe Valley Post Combustion Capture project.
Mr Miller said the exploratory work was costly but believed the potential discovery warranted further investigation.
He added the aquifer systems existed close to the Valley and could be utilised by the energy industry in the region.
Greenearth Energy was utilising Geothermal Exploration Permit 13 (Latrobe Valley) to carry out its investigations and has utilised the Federal Government's $50 million Geothermal Drilling Program (GDP).
The GDP is part of the $500 million Renewable Energy fund.
Greenearth Energy currently has access to $7 million of the fund, which works on a dollar-for-dollar basis.
``We are seeking matching dollar-for-dollar funding from either major energy users, major CO2 emitters or if you like, community groups and maybe we could present a collective approach,'' Mr Miller said.
``We believe there is significant opportunity for geothermal production and believe there is no better time for us and consortia to establish the potential for CO2 geosequestration onshore.''
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