Government sets geothermal power subsidy at £140 per megawatt hour


heatmapGeothermal power developers will be able to bid for government support in the next round of contracts for difference (CfDs), which are designed to bring forward renewable and low carbon power generation.

Less established technologies, including tidal and wave power, as well as energy from waste, offshore wind and geothermal power, can bid for up to £290m in competitive auctions commencing next month (3 April 2017).

For geothermal power projects to be delivered between 2021 and 2023, the department for Business, Energy & Industrial Strategy (BEIS) has set the support rate at £140/MWh, whether or not projects are developed with combined heat and power infrastructure.

While that is a higher level of subsidy than most technologies, such as offshore wind and combustion forms of energy from waste, it reflects the nascent stage of UK geothermal heat. To date, there has been no deployment of deep geothermal power projects in the UK.

The decision follows the department’s call for evidence on geothermal heat. Cornwall County Council was one of 14 respondents to the call, suggesting interest in developing geothermal heat in the UK’s south west. Utilities Engie and EDF also responded.

Within the response, BEIS also confirmed CfD support rates for other less established technologies.

Advanced conversion Technologies will receive £125/MWh stepping down to £115/MWh; dedicated biomass with CHP will receive £115/MWh; anaerobic digestion plant greater than 5MW will receive £140/MWh stepping down to £135/MWh; wave power will receive £310/MWh reducing to £300/MWh; tidal power will receive £300/MWh stepping down to £295/MWh. Offshore wind will receive £105/MWh reducing to £100/MWh.

See the full set of CFD notices here.

Screen Shot 2017-03-14 at 10.09.14Related stories:

Triad, CFD, capacity costs and RO: Prepare for bill increases, warns SmartestEnergy

Energy minister dismisses big company bias claims in CfD auctions

Public leisure facilities shutting down due to energy policy costs

Click here to see if you qualify for a free subscription to the print magazine, or to renew.

Follow us at @EnergystMedia. For regular bulletins, sign up for the free newsletter.


Please enter your comment!
Please enter your name here