Ashley St.Louis, Portfolio Manager at Gravis, explains what geothermal energy is and how the heat beneath our feet can be harnessed to provide low-carbon heating and electricity.

He also discusses the advantages and challenges of geothermal energy, its potential role in helping the UK meet its net zero targets, and highlights Gravis's experience as a first mover in this sector.

Geothermal energy is heat from the Earth. The deeper you go underground, the hotter it gets, with the Earth's core being around the same temperature as the surface of the sun. Essentially, it's extracting the heat from the Earth's core and bringing it up to the surface.

Geothermal energy works by tapping into underground reservoirs of hot water and steam, which can be brought to the surface and used to generate electricity or provide direct heating. In some systems, pipes are drilled into the ground to circulate fluid, capturing the Earth's natural heat and transferring it to buildings or networks. Think of it like a giant underground radiator: water is pumped deep down into the ground where it's heated by the Earth's core, it is then brought up to the surface, where the hot water or steam can then be used to heat buildings or even generate electricity.

The UK has significant geothermal potential, especially in areas like Cornwall, Northern England and parts of Scotland. While it's not as common as wind or solar, studies suggest that geothermal could meet a substantial share of the UK's heating demand in the future - potentially up to around 20%. It's a consistent, low carbon energy source that isn't dependent on weather, making it ideal for long term energy security.

Geothermal energy has quite a few advantages. It's a clean, renewable energy source, it runs 24 hours a day, seven days a week - unlike solar or wind, it isn’t dependent on the weather. Geothermal energy also supports energy security as there is no need to import it and, over time, it can be affordable, especially with long term use and local distribution.

The main barriers have been high upfront costs, long development timelines, and relatively low public and political awareness. Unlike solar and wind, which have received substantial subsidies, geothermal hasn't had the same level of government support. However, that's beginning to change, as the UK looks to decarbonise heating and meet its net zero goals.

To mitigate the risks, geothermal energy producers can diversify their users. Instead of just heating homes, geothermal heat can be also used by businesses and services that need year-round heat, like distilleries, hospitals and swimming pools. By generating electricity, they can also serve schools, farms and the NHS in nearby communities.

Gravis has experience in sustainable infrastructure investments and was a first mover in the UK geothermal energy sector. We helped fund the deepest geothermal well in the UK, through our investment in Eden Geothermal Limited in Cornwall. Our funding helped construct a 4.5km well, situated at the Eden Project, providing heat for Eden's biomes, offices and growing point nursery.

Our backing helped bridge the funding gap and give projects like the one at Eden, the momentum needed to scale.

In the UK, geothermal energy can grow if given the right backing and support from government, namely in terms of subsidies and further funding - helping to develop existing projects, as well as helping to construct new ones.

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