Initially resource consent only allowed Osborne to bore to 50m, which resulted in a system that was about 40 per cent efficient and could not produce hot water in commercial quantities.
Now the bore reaches 135m into the earth and the greater heat at that depth, along with improved technology, has improved efficiency to 98 per cent.
The system has also been improved by replacing metal piping with plastic fusiotherm, which are not corroded by the minerals in the water. The whole project has cost an estimated $200,000, but Osborne said it would pay off for the motel and for Rotorua if the technology could be used to make better use of the city's geothermal resources.
"You couldn't do it everywhere in Rotorua, but this really is a wasted resource and somebody needs to do exploration and trials around the city to see what is possible."
Osborne would like to see control of local geothermal resources lie with Rotorua District Council, rather than the Bay of Plenty Regional Council, as he said it had sometimes been difficult dealing with people from out of town who were not familiar with Rotorua's geothermal situation.
"It has been an exercise in perseverance, but we have now reached the point where we are seeing the benefits."
With annual energy savings of about $30,000, he said the third phase of the project should have paid for itself within three to four years. Alpin is now 98 per cent self sufficient, although he said energy bills had not dropped proportionally due to the ratio of fixed distribution costs to consumption costs.
"But we are future-proofing ourselves against future energy price rises.
"This is good for Rotorua and anything that progresses geothermal has to be good for our image and our sustainability. I hope this is the catalyst for more research and development into using geothermal energy."