The government has signalled its strongest support yet for geothermal energy, a resource long sidelined in the national renewable debate. Beneath the lawns of Cornwall, the streets of Manchester and the farmlands of Yorkshire lie vast reservoirs of heat capable of supplying low-carbon power and heating for centuries. But a combination of high upfront costs and geological uncertainty have kept the industry in a state of cautious optimism rather than full deployment.
A new report from the Department for Energy Security and Net Zero acknowledges that geothermal could meet up to 15% of the UK’s heat demand by 2050. This is a notable shift. For years, the conversation around renewables has been dominated by wind and solar. Geothermal is often described as the forgotten sibling: abundant, always available, but expensive to access. The heat beneath our feet is a nuclear reactor running at a steady 4,000 to 5,000 terawatt-hours of thermal energy, equivalent to 100 years of primary energy consumption. Yet we have barely scratched the surface.
The challenge is economic. Drilling a single well to depths of 2 to 5 kilometres costs between £5 million and £20 million. For a district heating network to break even, it needs a cluster of wells and a customer base willing to pay for connection. The government’s new support includes a £100 million fund for deep geothermal projects, along with planning reforms to fast-track permits. But industry experts argue that this is a fraction of what is needed. Compare it to the £365 million annual subsidy for biomass or the billions allocated for offshore wind, and the disparity is clear.
Geothermal’s advantage lies in its constancy. Wind dies down. The sun sets. But the Earth’s core remains at 5,000 degrees Celsius. Enhanced geothermal systems, which involve fracturing hot rocks and circulating water, can operate 24/7 with a capacity factor above 90%. This is not intermittent power. It is baseload renewable energy, something the grid urgently requires as coal plants retire and nuclear capacity declines.
There are signs of momentum. The United Downs project in Cornwall, co-developed by Geothermal Engineering Ltd, began generating electricity earlier this year. It uses a binary cycle plant that converts heat from 5.5 km deep into 3 MW of power, enough for 7,000 homes. The company plans to scale up to 10 MW by 2025. Similar projects are under development in Cheshire, where a former coal mine will be repurposed to extract geothermal heat from flooded workings. This mine-water approach is cheaper: it uses existing shafts and avoids the cost of deep drilling.
The government is also betting on shallow geothermal. Ground source heat pumps, which extract heat from the top 100 metres, can be installed in individual homes at a cost of £10,000 to £15,000. The Boiler Upgrade Scheme offers £5,000 grants to offset installation, but uptake has been slow. Only 2,000 pumps were installed in the first year, against a target of 600,000 annually by 2028. The problem is public awareness and builder training. Most plumbers and heating engineers are unfamiliar with the technology.
Environmental groups have cautiously welcomed the announcement. Friends of the Earth described geothermal as “a sensible part of a diverse renewable mix.” But they warned against the risk of small earthquakes, a phenomenon known as induced seismicity. Enhanced geothermal projects have caused minor tremors in Switzerland and South Korea. However, industry standards have improved. The British Geological Survey now monitors seismic activity in real time at all deep projects.
The economics may yet improve. As carbon pricing rises and drilling technology advances, the levelised cost of geothermal could fall from £120 per MWh today to £50 by 2030, competitive with offshore wind. That will require sustained investment and a workforce trained in geothermal engineering. UK universities are only now beginning to offer specialised courses.
There is a looming labour shortage. A report by the Geothermal Association estimates that the sector will need 10,000 trained workers by 2030. Currently, the entire workforce numbers fewer than 500. Transitioning oil and gas roughnecks into geothermal drillers is logical: the skills are transferable. But the industry must compete with higher wages in fossil fuels.
For now, the government’s backing is a clear signal that geothermal must be taken seriously. The energy transition cannot rely solely on weather-dependent renewables. Basement heat is not a silver bullet, but it is a steady, low-carbon foundation. The question is whether we have the will to dig deep enough.
