The UK’s first geothermal electricity power station may be months away from being built but it has already attracted £1 million from investors in just two days – and punters are right behind it.
Geothermal Engineering Limited is preparing to carry out test drilling at a site in United Downs near Redruth after announcing Cornwall could lead the way in geothermal energy production over the coming years.
The firm, which recently re-issued tender for drilling a geothermal heat well at Jubilee Pool in Penzance, is set to begin exploratory drilling at Union Downs early in 2018 after going to tender in the autumn.
If the £10m test site proves a success, a power plant could be operational by 2020, and could produce enough electricity to fully supply up to 1,500 homes.
The United Downs geothermal energy plant. Picture GEL.
The company hopes it would be the first of many such projects for Cornwall, which is seen as the perfect site for geothermal energy in the UK thanks to the duchy’s granite soil.
Geothermal technology makes use of the natural heat of the earth and, as the granite below the surface across Cornwall has the highest temperatures in the country, the county is seen as a literal hotspot.
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To generate electricity water is pumped 4.5km below the surface of the earth, where it is heated to up to 175C before being pumped back to the surface, where it is used to drive the power plant.
The company has now launched an investment raising bond through ethical peer-to-peer finance platform Abundance on Saturday to raise further capital for the Redruth site – and punters have backed it up to the tune of £1m already – a fifth of what is needed.
How geothermal energy drilling works.
The project has recently been awarded a £10.6m grant from the European Regional Development Fund and £2.4m of public funding from Cornwall County Council.
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Bruce Davis, co-founder and managing director of Abundance, said there was a strong appetite for investing in the next wave of renewable technologies, which offer a win for the planet and a win for their financial aspirations too.
He added: “While onshore wind and solar will always be important as established renewable energy generators, the sector is moving beyond that now to the next generation of technologies like geothermal and tidal, with Abundance investors backing them through their ISAs.”
Picture by GEL.
The crowdfunder follows a similar investment in Tidal Energy, which attracted a record-breaking £1m in its first 24 hours.
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The United Downs geothermal bond will pay 12% in interest and has an 18-month term. Interest will be paid in full at the end of the term and it is eligible to be held in an Abundance Innovative Finance ISA, so returns are tax-free.
A 2012 study by Sinclair Knight Merz ‘Geothermal potential in Great Britain and Northern Ireland’ estimated that geothermal energy – which captures the heat held in rocks far beneath the earth’s surface – has the potential to meet up to 20% of UK electricity needs, with zero carbon emissions and providing a constant supply.
Mr Davis added: “Geothermal technology is proven to work in Italy and Iceland but hasn’t so far been used in the UK to generate electricity. This is a ground breaking project, which is backed by EU grants and Cornwall Council, and offers a chance for ordinary people to take a stake in something with the potential to deliver significant carbon reductions in the future.”
The first stage is drilling of a well down to 2.5km followed by a second deeper well of 4.5km to create a geothermal circuit to power the electricity generation plant built on the surface.
The geothermal plant will have a target capacity of 3MW of constant power, enough to supply 5,500 typical homes each year, from two deep wells with an average diameter of approximately 20 cm, and with a generation plant the size of an average house.
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Ryan Law, managing director of Geothermal Engineering, said: “The geothermal resource beneath our feet is extensive, and, if properly managed, inexhaustible. The granite rocks of Cornwall have the highest heat flow in the UK and are the best place for the development of geothermal power.
“The United Downs project is at the cutting edge of geothermal technology and we want to give the local community the chance to be involved in this project.”
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Source: Cornwall Live