This article is part of our special report Geothermal energy.
A growing number of cities in Europe are betting on geothermal to provide households with clean heating, but the little-known renewable energy source will need more attention from Brussels in order to scale up.
Since 2003, Munich features among the European cities pioneering the deployment of geothermal energy.
The local utility, Stadtwerke München (SWM), already operates five geothermal plants. And in its ‘Vision 2040’ strategy, the city outlined plans to continue tapping into deep geothermal with a view to provide 100% renewable heating to residents by 2040.
About 560,000 households could be powered by geothermal energy alone in two decades, the utility told German newspaper SZ.
Buildings currently account for about 40% of the EU’s energy consumption and are responsible for 36% of its greenhouse gas emissions. When industrial needs are added, heating even makes up around 90% of total energy consumption in a country like Germany, said Helge-Uve Braun, chief technology director at SWM.
This is why heating and cooling decarbonisation features among the key objectives of the European Green Deal, which aims for net-zero emissions by 2050.
“The success of the energy transition is decisively dependent on the decarbonisation of heating, in which huge investment efforts, including more public funding, need to be made,” Braun said.
Often called the ‘sun beneath our feet’, geothermal energy is attracting renewed interest in Europe as local governments step up efforts to decarbonise their heating systems.
Geothermal delivers energy all year round, 24 hours a day, generating baseload electricity and heat while providing flexibility and dispatchability when other renewable energy sources like wind and solar are variable.
Italy continues to have the highest number of geothermal plants in Europe, all of them located in Tuscan cities like Pisa and Siena. But other major European cities, such as Paris and Vienna, are now also turning to geothermal energy to meet their decarbonisation targets.
At the EU level, however, regulators have so far paid little attention to geothermal.
Overall, renewable heating remains the ‘orphan child’ of Europe’s energy transition, said Jörg Mühlenhoff, energy transition policy coordinator at CAN Europe, a green campaign group.
“The European Commission often focuses, unfortunately, on carbon capture and storage and other technologies, and more broadly, even hydrogen is discussed for heating our buildings,” Mühlenhoff said.
“These technologies are not yet mature, besides the fact that their climate benefit would be more than questionable. Instead, we need to focus on sustainable renewable solutions that are readily available,” he told EURACTIV.
‘High-level vision’ lacking
The lack of political will is the main hurdle standing in the way of geothermal energy, Sanjeev Kumar, head of policy at European Geothermal Energy Council, told EURACTIV in an interview earlier this month.
The United States, Turkey, Indonesia, and China are among the countries pushing more strongly for geothermal energy, with political elites standing behind it. In China, for instance, the development of geothermal has featured in its last two Five-Year Plans.
A similar ‘high-level’ vision is required at the European level if geothermal is to contribute to the bloc’s heating decarbonisation goals, said Marit Brommer, executive director at the International Geothermal Association, an industry group.
“At the moment, the high-level vision of the European Commission’s plan, if you look at ‘Fit for 55’ and if you look at the Green Deal, is all about solar, wind and hydrogen,” Brommer said.
“And if [geothermal technologies] are not mentioned in that high-level document setting our roadmap towards net zero, then it’s going to be very difficult for member states, regions and city councils to actively seek the benefits and policy instruments to create a favourable regime or environment for geothermal,” she told EURACTIV.
The revised Renewable Energy Directive is seen in the industry as a first step in the right direction to support geothermal. Yet the proposal currently stands falls short of boosting renewable heating and cooling, the ‘orphan child’ of Europe’s energy transition, according to Jörg Mühlenhoff from CAN Europe.
Getting the green light from local authorities to drill and install a geothermal plant can also be a long and frustrating process, said Daniel Moelk, country manager for Germany at Eavor, a Canada-based geothermal start-up.
“If you look at municipalities, they want to decarbonise today. And permitting and land issues slowing us down come with a risk. We can only wait until a certain point of time, but if it takes too long, municipalities might have to choose a less favourable solution, like prolonging the offtake agreement with coal-fired power plants or building a gas turbine,” he said.
‘Policy mix’ needed to support geothermal
Installing a geothermal plant is not cheap. Drilling costs amount to around €5 million per well, representing the lion’s share of the total expenditure.
But once the installation is in place, geothermal offers a cheap and reliable energy source compared with fossil gas while delivering much more energy per unit.
In addition to the revised Renewable Energy Directive, experts believe that several other policy measures included in the EU’s ‘Fit for 55’ climate package could support the development of geothermal energy.
The revision of the Energy Taxation Directive should make heat pumps and renewable heating sources much more cost-competitive than fossil gas boilers, said CAN Europe’s Mühlenhoff.
“Fossil gas boilers are so cheap because it’s a mass technology, and they are even subsidised publicly and supported with low energy taxes compared to the energy content, which creates a distortion of the competition between the energy carriers,” said Mühlenhoff.
But any reform will be hard to agree on as decisions on taxation are taken by unanimity at the EU level.
“There is still a long way to go. To decarbonise the heating sector with the help of deep geothermal energy, it is necessary to create a level playing field for district heating and individual heating systems,” he told EURACTIV.
Yet, there are also favourable winds blowing for the industry. Helge-Uve Braun from SWM believes carbon pricing policies will be essential to support the scale-up of geothermal. This includes new initiatives such as plans to extend the EU’s emissions trading system (EU ETS) to heating and road transport, he said.
[Edited by Frédéric Simon/Zoran Radosavljevic]