Under the terms of the partnership, the companies will collaborate on five projects to tap into the heat that occurs naturally only a few kilometres underground. Work on the first project, located in the North West of England, will begin this year.

Geothermal plants “are uniquely suited to an urban setting, where energy demand is at its densest”, says GT Energy. “Just one acre is required for construction and drilling of boreholes, and once this initial phase is complete, a plant’s impact on its surroundings is minimal.”

GT Energy’s agreement with E.ON is part of a shift in focus to UK operations for the Irish firm, stimulated by the UK government’s Renewable Heat Incentive (RHI) programme, says the firm, which has undertaken a number of early projects in Ireland, including securing planning permission for its first geothermal electricity generation plant. With plans to develop 500MW of capacity, the company has set itself a strategic goal of becoming “the UK’s primary provider” of renewable heat energy. 

 “Central government backing in the UK is already making a huge difference to a fledgling industry,” says Padraig Hanly, managing director of GT Energy. “The UK’s Renewable Heat Incentive is a welcome and positive step.” Administered by the UK’s Department of Energy & Climate Change, the RHI programme can draw on funds of £70m during 2012/13 to support the development of renewable heat projects.

The UK is sitting on 100GW of geothermal potential, up to four per cent of which could be readily accessed by 2030, according to a study by Sinclair Knight Merz (SKM), a global consultancy firm with involvement in more than 3GW of geothermal development across 20 countries. “The resulting 4GW capacity would be equivalent to 25 per cent of the UK’s 2020 target for renewable energy generation,” notes GT Energy. “Moreover, unlike wind, solar and wave power, deep geothermal plants produce energy smoothly and reliably, around the clock, regardless of the weather.”