Geothermal Heat and Power

Baroness Walmsley Excerpts

Thursday 6th July 2023 Grand Committee

[Baroness Walmsley (LD)]

My Lords, I am delighted that the noble Lord, Lord Cameron of Dillington, has given us the important opportunity of this debate. I will focus my remarks on shallow geothermal, although deep geothermal is also highly efficient and has a low visual impact and no noise or emissions when installed. One cannot say that about wind turbines.

Eighteen years ago, my husband and I built a little wooden house in Aberdeenshire for family holidays. We installed shallow ground source heating, which began my love affair with capturing heat from the ground and cutting electricity bills while contributing to saving the planet. It has never let us down, even when the air temperature was well below zero. At that time, few contractors could install such a system, but we found one—although we used a Swiss heat exchanger as there were no British ones then. The contractor complained that it was hard to get skilled installers and there was no help from the Government to train them.

Today, that technology has developed and is even more important as we aim for net zero. Hydrogen will not be our saviour when we stop burning gas for space and water heating, as it takes six units of electricity to get one unit of hydrogen. In contrast, one unit of electricity will get us four units of heat from the ground.

What is the answer on the scale we need? My family’s individual solution had a higher upfront cost than most people can afford, so others in off-grid locations in rural areas will need some government support. In streets where houses have little or no garden, in terraces where individual air source heat pumps cannot be installed and in blocks of flats, the answer is ground source heat networks, as my noble friend Lady Sheehan said. Networks provide a utility in the street to which homes can connect as easily as connecting to the gas mains. The Kensa Group, the British manufacturer and installer, has just completed a demonstrator project, supplying the first village in the world, Stithians in Cornwall, with its own clean heat network. My noble friend explained how it works. The company is growing and creating many jobs, although the UK is a long way behind France, the Netherlands and Germany, so opportunities for UK growth are being lost. We are well behind the curve again.

Although deep geothermal is currently costly, costs are coming down as technology develops. Pilot schemes are happening in areas with the most potential heat gain, such as Manchester and Stoke-on-Trent, but shallow ground source is appropriate in all locations. Just as wind and photovoltaic technologies were supported by the Government to help them scale up, the ground source industry needs the same. We also need funding for training installers. Crucially, the energy efficiency of ground source will reduce future pressure on the national grid, but only if we realise its full potential. The technology is cost effective in the long term: deep ground source infrastructure will last for 100 years, and shallow for at least 25 years, compared to 15 years for air source. The industry is aiming for subsidy-free growth by the end of this decade, but it needs help now to enable it to get there, just like solar and wind did before, so what can the Government do?

First, when will the Government decide on the future homes standard so that the market knows that no new homes will be connected to gas from 2025 and when will gas boilers in existing homes be phased out? Secondly, despite their lower energy efficiency, gas boilers are still cheaper to run because of the artificially large disparity between electricity and gas prices. The Government could tackle that; will they? Thirdly, most heat pumps will be installed in existing properties, so we need a proper incentive for GSHPs. The current five schemes have poor uptake and are badly designed for ground source. Will the Government work with the industry to develop a scheme to help the GSHP industry become subsidy free by 2028?

The Commons Environmental Audit Committee concluded that the Government were too slow to exploit the potential of geothermal and had not integrated it into the net- zero strategy. Will the Minister respond to that challenge, particularly in light of the need for improving the energy security of this country given recent events? Nobody can take away the heat beneath our feet in our own ground—not Russia, nor China—but we have to exploit it.