Potential for deep geothermal energy in Scotland: study volume 1

1 Introduction

1.1 Context

The Energy and Climate Change Directorate ( ECCD) of the Scottish Government (the Client) have identified deep geothermal energy as a particularly important emerging renewable energy technology that could have the potential to play a significant role in Scotland's future energy provision.

Exploitation of deep geothermal heat energy could potentially deliver many benefits to Scotland, including:

• Reducing carbon emissions and helping Scotland build a sustainable low-carbon economy in order to meet the legislative requirements for emissions reductions;
• Increase the use of renewable heat to help exceed the targets set out in the 2020 Routemap for Renewable Energy in Scotland;
• Potentially help to exceed the targets for renewable electricity production;
• Become a viable alternative source of energy, improving local and national energy security and reducing reliance on external sources of energy;
• Help reduce fuel poverty through the use of district heating networks;
• Regenerate brownfield sites, including in former mining and industrial areas;
• Provide skilled employment opportunities, with cross-over with the oil and gas and manufacturing sectors; and
• Push Scotland towards the forefront in the technology required for exploiting deep geothermal resources, particularly in areas previously considered as marginal or even not viable.

To date, the extent and location of the potential deep geothermal resources has not been well defined. In addition, potential commercial investment in development of deep geothermal energy requires greater certainty on the current administrative framework, including clarification of legal ownership of resources legal ownership, resource licensing, supportive planning and permitting regimes, and financing.

1.2 Scope of this Report

The Scottish Government commissioned AECOM (in collaboration with the British Geological Survey) to carry out a study to identify the next steps that are necessary to take forward the commercialisation of deep geothermal energy in Scotland, comprising the following:

• Stage One - assessment of the areas most likely to hold deep geothermal resource based on existing geological data sets, and
• Stage Two - Identification of policy options and key actions that the Scottish Government can implement to encourage commercial exploitation of the available geothermal resource, including providing policy options, key actions, and who should be responsible for their implementation.

Stage two includes assessment of resource licensing (and the wider implications of any proposed licensing regime), environmental regulation and consenting, planning, and cost, benefits and financing.

The study has been carried out under the Scottish Government project number AEC/001/11.

This report has been undertaken by AECOM on behalf of the Scottish Government and does not necessarily represent the views of the latter.

1.3 The Content of this Report

1.3.1 Stage One

The British Geological Survey ( BGS) undertook stage one in collaboration with AECOM. The BGS are uniquely placed in terms of geological knowledge and skills in order to identify the areas likely to contain the most significant geothermal resources.

The BGS's resulting report, 'Deep geothermal energy potential in Scotland' ( BGS Commissioned Report CR/12/131, 26 April 2013) is summarised as a non-technical summary ( NTS) in Section 2 and the full report is contained in Volume 2 of this report.

The first part of the BGS's report includes a background to geothermal energy, sets the geological context and summarises the geothermal data currently available for Scotland. The second part of the report reviews the available geothermal resources in three key geological scenarios; abandoned mine workings, hot sedimentary aquifers and hot dry rocks.

1.3.2 Stage Two

AECOM undertook stage two and this comprises:

• A review of legal ownership of deep geothermal resources based on advice to the Scottish Government from DECC;
• A review of potential resource licensing for Scotland;
• A review of the existing regulatory regime for deep geothermal developments;
• A review of the likely costs, financial risks, financing options and potential benefits; and
• Recommendations for policy options and key actions in the above areas.

Following initial research, a stakeholder workshop was undertaken at the BGS's offices in Edinburgh on 31 October 2012 to present the findings of the initial research and to gather the views of a wide range of stakeholders across the geothermal sector. The main outputs from the workshop are summarised in Appendix C, including a list of participating organisations. These outputs were used to inform and guide the second part of the study which is presented in this report.