Decarbonisation Technology - August 2023 Issue

credits (Lombard Odier, 2023) aimed at driving the country’s transition to clean energy and its infrastructure. This model of serious government support to advance a nation’s net-zero agenda is one that experts anticipate seeing replicated across the globe in coming years.

The positive impact of introducing geothermal regulations can be seen in countries such as The

Netherlands, which set out the Geothermal Heat Action Plan in 2016 (Cariaga, 2022)

Heat Seeker map

above- and below-ground drivers. Utilising these capabilities, we work with governments and organisations around the world to advise on developing integrated low-carbon energy solutions. Despite the running costs related to operating geothermal developments remaining fairly low and steady throughout the 30-50 years project lifetime, the initial investments can still be off- putting to many potential backers. It is with this in mind that government involvement will be crucial if geothermal energy is to become a key factor in supporting the wider decarbonisation of industries. What role can governments play in expanding geothermal energy’s potential? With nations across the globe united in their front to successfully achieve the goals laid out by the Paris Agreement, there have been significant increases in funding for all forms of renewable energy. Governments have an important role to play in stimulating the growth of geothermal energy. An increasing number of countries are encouraging developments through initiatives such as upfront subsidies or minimum off-take pricing. There is an additional need for clear, transparent, and stable regulations to help informed investment decisions. We have already witnessed such policies coming into place in the US, as President Biden introduced the Inflation Reduction Act in 2022, a USD 391 billion package of subsidies and tax

to increase geothermal energy. The action plan gives better drilling insurance to help cover drilling risks, investment in software that supports geothermal heat exploration, and grants for geothermal heat pumps. As of 2021, there are 60 geothermal exploration licenses in force, according to the 2020 Annual Report on Natural Resources and geothermal energy in the Netherlands (NL Gov, 2021). This investment is particularly impressive, as the Netherlands is not considered to necessarily have the most favourable subsurface setting for geothermal. Despite these international advancements, there are many nations that are critically lagging behind in scaling up their geothermal agenda. Recently, energy industry bodies, such as the Association for Renewable Energy and Clean Technology (REA), have lobbied the UK government to establish a Geothermal Development Incentive. If successful, funding should allow for a viable geothermal project to be initiated. With heat accounting for 40% of the UK’s energy consumption and nearly a third of UK greenhouse gas emissions, this scheme could provide access to enough geothermal heat energy to supply all of the UK’s needs for at least 100 years. The added insurance given by the scheme would undoubtedly see a rise in drilling for geothermal energy in the UK (Richter, 2021). However, while government backing remains lacking in certain geographies, the potential for geothermal to be successfully integrated into companies’ wider decarbonisation schemes will continue to be dictated by understanding