Three winners get hot £1.1m prize in Geothermal competition

Posted on 22 December 2010

Three geothermal projects run by Keele University, Newcastle and Durham University and Cofely District Energy in Southampton have won a total of £1.1 million in funding from the Government’s Deep Geothermal Challenge Fund’s second round.

Minister of State for Energy and Climate Change Greg Barker said:

“I want to ensure that geothermal energy – which is both renewable and can be produced locally – can become one of the energy technologies of the future.

“Today’s announcement is an exciting step forward in making this happen here in the UK, and I’m looking forward to seeing these innovative projects get off the ground and working.

“Geothermal sources in the South West of the UK alone have the potential to meet 2% of the country’s annual electricity demand”.

Deep geothermal energy uses the natural heat found kilometres underground to produce electricity and heat at the surface. Geothermal energy is non-intermittent, low-carbon, renewable and could be a valuable technology in diversifying the UK’s energy mix and reducing the UK’s dependence on imported fuels.

The first round concentrated on deep geothermal power, and the two successful Cornwall-based projects continue to move ahead. This second round has concentrated on heat-only projects. The Government continues to see a strong future for all types of deep geothermal energy.

The Deep Geothermal Challenge fund was set up to help companies carry out exploratory work needed to find viable sites for this technology. The funding has been allocated as follows:

£500,000 to Keele University, to drill a 1200m borehole to provide geothermal heat for their proposed sustainable campus;

£400,000 to a Newcastle/Durham University project to fund the drilling, hydraulic testing and geophysical logging of a 2km deep borehole at ‘Science Central’, a large development in central Newcastle;

£200,000 to Cofely District Energy Limited, to part fund the refit of the Southampton deep geothermal well.


Notes for Editors

This is the second round of the Challenge Fund: £4 million was made available in the first, which was fully allocated and spent, and £1 million in this second round [(this has been extended to £1.1m) - subject to final approval from Finance]. Projects in England, Scotland, Wales and Northern Ireland are eligible to bid to the fund.

While the majority of funding from the first round was awarded to deep geothermal power projects, this second round has concentrated on heat-only projects. Both technology types can make significant contributions towards the UK’s objectives on renewable and low carbon energy.

Following the banding of the Renewables Obligation, which came into effect on 1 April 2009, electricity generated from deep geothermal technology falls into the ‘innovative’ technology band and is thus eligible for support at a rate of 2 Renewable Obligation Certificates (ROCs) per MWh generated. More detail about the Renewables Obligation can be found on the Renewables Obligation web page.

Heat produced from deep geothermal energy sources would be renewable in nature. As was made clear in the Annual Energy Statement, the Government is fully committed to taking action on renewable heat.

It has been estimated that the deep geothermal power from the South West of England alone could meet 2% of the UK’s annual electricity demand. In the UK as a whole, it has been estimated there is geothermal resource to produce up to 35 TWh of electricity per year for around 50 years.

(Press release from the Department of Energy and Climate Change)