Isra-Mart srl:Will Renewable Obligation review warm to deep geothermal?

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Hopes are growing that a soon-to-be-published report detailing the level of financial support available to large-scale renewable energy projects from 2013 could include plans to boost incentives for deep geothermal energy projects.

The Department for Energy and Climate Change (DECC) has confirmed it is planning to publish a report in the next few weeks by consultancy Arup, examining the costs and deployment potential of every technology eligible for the Renewables Obligation (RO) subsidy mechanism. The findings will feed into a fast-track consultation due to be launched in July, which will determine new banding levels for the RO from 2013.

Despite the fact that the government has yet to confirm any specific recommendations, Climate Change Minister Greg Barker has already indicated he is keen to raise the level of support for deep geothermal energy projects through both the RO and the planned Renewable Heat Incentive (RHI).

"Deep geothermal energy is an exciting renewable energy source with considerable unexploited potential," he said. "We are currently reviewing the support given to all renewables technologies under the RO, including geothermal."

Currently, deep geothermal generators in England and Wales receive two RO certificates (ROCs) per megawatt hour (MW/h) generated. However, developers argue that level is insufficient to drive the investment required to kickstart the industry and help realise the full potential of deep geothermal in the UK.

The Renewable Energy Association's Geothermal Group has been lobbying DECC to double the level of support to four ROCs per MW/h. Stuart Pocock, REA technical director, told BusinessGreen the group has received encouraging signals from government that it could boost support for deep geothermal.

"We have had various meetings with DECC [and] have received positive noises from them that they see deep geothermal as a significant source of renewable energy generation and they are sympathetic to the argument," he said. Although he insisted DECC has not confirmed if it is prepared to make the changes being called for.

The government has come under increasing pressure from the industry to increase its support for deep geothermal power, especially after it halved the Deep Geothermal Energy Fund from £2m to £1m in September last year.

There is currently just one deep geothermal power plant operating in the UK, through the Southampton Geothermal District Heating Scheme. However, DECC's 2050 Pathways Analysis has predicted geothermal energy could potentially generate 35TWh, or 10 per cent of current annual electricity demand; two per cent of which could come from the South West of England.