What is geothermal energy?

Geothermal energy is the thermal energy stored in high pressure water zones, steam or hot water systems as well as in hot stone below the earth’s surface. The thermal energy consists partly of the permanent heat flow from the earth’s core through the mantle, which ultimately releases its energy at the surface into the atmosphere. The other part originates from natural radioactive disintegration processes taking place in the mantle and releasing energy.

The use of geothermal energy can be divided roughly into near-surface or deep-seated geothermal energy. While near-surface utilisation of geothermal energy supplies single buildings (or complexes of buildings) with heat by earth heat collectors in combination with heat pumps (depth approx. 15 - 150 m), deep geothermal energy offers the possibility of larger dimensioned energy supplying projects, including the generation of electric power.

Deep hydrothermal energy is a special case, because water-bearing layers (aquifers) are used in great depth (2,000 - 5,000 m). For this purpose at least two boreholes are required (production well, reinjection well), because the raised thermal water has to be reinjected into the same layer after being cooled down.

Where is hydrothermal energy generation feasible in Germany?

In the following map of Germany the regions are marked where deep-seated hydrothermal energy projects have already been realised or a geological potential for exploitation exists according to geologists’ evaluations.

The geologic region of the Southern German Molasse Basin has to be pointed out especially, since the successful realisation of numerous heat supply projects in this area proved the feasibility. Therefore a lower geological risk of finding a sufficient amount of thermal water can be assumed.

The aquiferous geological layer “Malmkarst” declines from north to south. This influences the drilling depths of production and reinjection wells and the water temperatures. The following illustration shows a cross section of the Molasse Basin and some existing boreholes located in it.

What advantages does the geothermal power provide especially for a municipality?

The great advantage of geothermal energy generation for a municipality is the provision of heat that is low and stable in price. This is increasingly developing more and more to a location factor.

In the case of a geothermal energy plant the prices for the supply with district heat are based on the costs of the investment and the labour costs. Therefore the increasing prices for fossil fuels have a lower influence on the prices for district heat. Therefore the supply with heat has a high stability in price.

What are the main risks of a geothermal project and how can they be reduced?

The risks of a geothermal project can be found in different areas. These include geological, technical and economical as well as management risks.

• The so-called "Drilling Exploration Risk" is the most important barrier of the investment in a geothermal project. Unless the drilling is finished, there can not be made any statement, if sufficient thermal water can be raised that is also an important factor for the economic success and the implementation of a geothermal energy project.
• In the meantime there is an opportunity to insure against the Drilling Exploration Risk. This was first implemented at the project in Unterhaching based on a concept developed by Rödl & Partner. The possibility of insurance and the premiums are dependent on every particular project and its risk structure and require a project-specific adjustment/assessment.
• The economic risk has to be pre-estimated through a detailed investment planning before the project is started. The accurate definition of the input factors, like the capacity and the temperature, is the basis for the calculation of the profitability that also can be used for the "Insurance against Drilling Exploration Risks". The part of the investment of the first drilling that has to be covered by the insurance and the premium is therefore based on the investor's willingness to take risks. The basis for this evaluation is the analysis of the profitability that has a high relevance for the overall concept.
• An often underestimated factor for the project's success is the needed man-power. For a successful and prompt implementation of the project an optimal coordination of technical, economical, legal and organisational fields of activity is essential. Due to the mutual influence there is a need for a centrally controlling institution. At Unterhaching, this task was undertaken by Rödl & Partner. Often decisions have to be made under high pressure of time (especially during the drilling-phase) due to the high daily costs of the drilling. Therefore the selection of strong partner has a very high priority.
• As per paragraph 114 ff. of the German Federal Mining Act there is a absolute liability for personal injuries and damage to property. If there is a seismicity due to the drilling activities, the project company has to take responsibility for this. Therefore an insurance solution has to be taken into account.

These risks presented here and the possible solutions are specific for every project. Use our knowledge to reduce the risk of your geothermal project.