Unlocking the earth's heat: An engineer's view on the UK's geothermal potential
The UK's Department for Energy Security and Net Zero recently released its "Geothermal Review and Cost Estimations" report, and it’s stirring up important conversations in the energy sector.
Here at Oilfield International Services, where we’ve spent decades understanding what lies beneath our feet, this is a subject close to our hearts.
The report, compiled by Arup, paints a realistic, if challenging, picture of geothermal energy in the UK.
Let's drill down into the details.
The Elephant in the Room: The Cost
There's no getting around it: the report highlights that geothermal power is, for now, a more expensive way to generate electricity than wind or solar. With a levelised cost of electricity (LCOE) ranging from £136 to £852/MWh, it’s a significant investment.
From our perspective in the field, this isn't surprising. The high upfront capital costs are driven by the very things we specialize in: drilling and plant construction.
Each well is a major engineering undertaking, and with modest power outputs of 2-3 MWe per well, the return on investment per drill is lower than a towering 12MW offshore wind turbine.
Wind and solar have benefited from a massive global investment push over the last decade, driving their costs down dramatically. Geothermal is still waiting for its moment in the sun, so to speak.
More Than Just Megawatts: The Untapped Value of Heat
However, to view geothermal purely through the lens of electricity cost is to miss the bigger picture. The report correctly identifies one of geothermal’s greatest strengths: its capacity to provide large-scale, consistent heat.
Unlike intermittent renewables, geothermal provides a constant, baseload power source. But the real game-changer is its potential for district heating and industrial processes. Selling this heat isn't just a side-benefit; the report estimates it could slash the LCOE by 40% to 60%.
This transforms the economic model entirely, turning a geothermal plant into a multi-faceted energy hub that provides both power and heat, enhancing energy security and efficiency on a local level.
Geothermal Power Concept
The Drilling Challenge: Where We Shine
The report makes a crucial distinction between different geological settings, noting that granite formations, like those in Cornwall, offer lower levelised costs than sedimentary basins. This is due to the greater power and heat latent in these granite systems.
This is where deep industry expertise becomes critical.
Drilling into hard, crystalline rock thousands of metres below the surface presents a different set of challenges than drilling into softer sedimentary layers. It requires specialized equipment, advanced techniques, and a profound understanding of subsurface geology.
While the capital expenditure may be higher, the long-term energy yield makes it a compelling proposition.
This is precisely the kind of complex, large-scale engineering project that our industry is built to handle. We have the technology, the skills, and the experience to unlock the potential trapped in these deep formations.
Our Takeaway: A Call for Investment and Expertise
The government's report is a welcome dose of reality. It confirms that geothermal energy is not a simple or cheap solution. But it also confirms that it is a powerful, reliable, and versatile one.
The path to making geothermal competitive is clear: it needs investment to drive innovation and scale, just as wind and solar have received. And it needs the deep, industrial-grade engineering and drilling expertise that companies like ours can provide.
The UK has a unique opportunity to leverage its world-class oil and gas heritage to become a leader in this new energy frontier. Geothermal is not impossible; it’s an engineering challenge waiting to be met. And we're ready to start drilling.