Members' Research Service By / October 30, 2023

Geothermal energy in the EU

Geothermal energy is heat generated within the Earth’s crust as a result of the planet’s formation and the radioactive decay of materials. Thermal energy is stored in rocks and fluids in the centre of the Earth.

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Written by Monika Dulian.

Geothermal energy is heat generated within the Earth’s crust. It is used mainly for electricity generation, district heating and industrial processes. Several geothermal technologies exist, at different levels of maturity. Heat is usually extracted from the ground using heat pumps to power district heating systems, or used directly to heat builidngs. Electricity generation uses the heat stored underground, converting it to electrical power. The three main technologies for electricity generation are dry steam, flash steam and binary cycle.

According to the International Renewable Energy Agency (IRENA), geothermal energy provides electricity generation in more than 30 countries worldwide, reaching a total installed capacity of around 16 gigawatts (GW) in 2021. In the EU, the gross capacity for electricty was just over 1 gigawatts electric (GWe) that year. EU electricity production amounted to 6 717 gigawatts thermal (GWth), with Italy responsible for most of it. Several other EU countries produce electricity from geothermal (Germany, Portugal, France, Croatia, Hungary and Austria), albeit with considerably smaller production. The geothermal district heating and cooling sector has seen a 6 % growth rate in installed capacity, reaching 2.2 GWth in 2021. Geothermal represented 0.5 % of the global renewable electricity market in 2022, generating 0.2 % of electricity in the EU.

Geothermal energy is a sustainable and reliable source that produces minimal greenhouse gas emissions while providing constant baseload energy generation. The challenges for large-scale geothermal energy capacity include high upfront development costs, long project development timelines and higher risk during the early phases of exploration. Another significant obstacle to the development of geothermal is the fragmented nature of statistics on geothermal energy and insufficient geothermal resource mapping.

The EU’s commitment to the geothermal sector is deeply rooted in the European Green Deal. Draft national energy climate plans show that EU Member States have promising ideas for geothermal. The development of geothermal is also set to be supported by the recently revised Renewable Energy and Energy Efficiency Directives. Moreover, the European Commission’s announced heat pump action plan has the potential to encourage the use of small and large geothermal heat pumps in buildings, heating and cooling systems, and industry.

Read the complete briefing on ‘Geothermal energy in the EU‘ in the Think Tank pages of the European Parliament.

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