By Marlene Orth, Consultant, Rödl & Partner
for the replacement of conventional coal or nuclear power plants. Extracted with some care, geothermal energy is nearly inexhaustible and could provide a limitless supply of heat. Geothermal energy is the only option to decarbonise large district heating networks in the long term. Switching to geothermal energy for district heating purposes allows for transitioning away from gas, coal or other imported sources of energy, thus reducing a community’s dependence on imports, which may be subject to political tensions. An independence from commodity imports means an independence from their fluctuating prices on the world markets, making geothermal district heating systems more consumer-friendly because heat prices are more stable and predictable.
As one of the most potent – but also probably one of the most misunderstood – forms of renewable energy, geothermal resources have an immense potential to futureproof Europe’s district heating networks. Geothermal district heating projects can help make Europe’s heat sustainable and independent, aiding the European community in reaching its climate goals. Especially Eastern Europe harbours an enormous potential to develop this technology but currently faces a number of institutional and financial barriers that need to be overcome first. INTRODUCTION TO GEOTHERMAL ENERGY Geothermal energy is heat stored in steam or hot water reservoirs, or hot rocks underground, which can be utilised for district heating and cooling as well as electricity generation. Deep geothermal energy is heat stored between 400 m and 5,000 m underground although some deep geothermal drillings tap into resources as deep as 10,000 m. The deeper the stratum, the hotter the water or steam, which can be extracted, which is why deep geothermal energy is a lot more potent than geothermal energy closer to the surface. Geothermal resources from about 20 – 40 °C onwards can be used for district heating. Although electricity can in theory be produced at temperatures as low as 40 °C, the resource in question should be at least 100 °C in order to be economically viable. Deep geothermal energy is stored in hydrothermal (water bearing) or in petrothermal (hot rock) formations. A hydrothermal source can be exploited more easily than a petrothermal one because the thermal water can be pumped to the surface right away. By contrast, to exploit heat stored in petrothermal rock formations, a fluid has to be injected into the ground first. This fluid is circulated in the underground reservoir, heated up by the hot rocks and then pumped back to the surface. The hot water can afterwards be used to power district heating networks or generate electricity. While petrothermal geothermal resources are the most abundant, their economic and technical usefulness is presently limited, which is why most geothermal projects draw from hydrothermal reservoirs. ADVANTAGES The most prominent advantage of geothermal energy compared to other forms of renewables is its capacity for baseload energy. In contrast to intermittent sources like wind and solar power, heat can be recovered, and electricity can be generated from a geothermal source according to demand, regardless of the time of day or the time of year, giving geothermal energy a much higher capacity factor than wind or solar. This allows
Base load capacity
Only option to decarbonise large-scale DH networks
Manageable sound pollution
Geothermal District Heating - Advantages
Efficient land use
Independence from fuel imports
Regional value creation
Stable prices - high predictability
Figure 1: Advantages of geothermal district heating
CHALLENGES There are, of course, a number of challenges associated with developing geothermal energy projects as well. As with all (renewable) energy projects, initial capital expenditure is considerable, rendering financing a project a substantial issue. In addition to the usual expenditure for plant construction, geothermal energy projects require a variety of studies (e.g. seismic studies) to determine suitable project locations and involve a very expensive drilling phase. There are, however, a number of financing options available, involving any imaginable combination of equity and debt to make geothermal projects feasible.
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