Who are the investors backing Britain’s first geothermal electricity supply?
United Downs in Cornwall, is Britain’s first deep geothermal power plant. Geothermal Engineering Limited (GEL), the company operating the facility, has announced its first electricity delivery – marking a milestone for geothermal energy in the UK.
The facility will deliver renewable-driven, 24/7 baseload power and Octopus Energy has committed to purchase at least 3MW of its output. United Downs also hosts GEL’s commercial scale production of lithium carbonate – a critical input for batteries.
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“This is a huge advancement for geothermal power in the UK and the beginning of our expansion plans. Geothermal energy and critical minerals extraction are naturally complementary as they share the same subsurface resource”, says GEL’s chief executive Ryan Law.
GEL’s facility was supported by a mix of public and private capital. Public support came from the Cornwall Council and the European Regional Development Fund. Private institutional backers include Thrive Renewables and Kerogen-CX Capital, a private equity fund manager. The latter has invested £15m in constructing GEL's geothermal power plant.
“United Downs is a major milestone for UK geothermal and a strong validation of our investment strategy”, commented Jason Cheng, Kerogen-CX Capital CEO.
“We believe the sector is at an inflection point and are committed to scaling it across the UK and Europe. Geothermal represents a compelling opportunity to drive economic growth while advancing systemic decarbonisation and advancing the energy transition”, he adds.
In addition to demand signals and Cornwall’s high surface heat flow, price stability has also added to the project’s feasibility. In 2023, the facility was one of three geothermal winners of a contracts-for-differences (CfD) award by the UK government. CfD data shows a final strike price of £119/MWh for geothermal energy.
In comparison, the government’s latest auction round recorded a £147/MW strike price for new gas power stations. Analysis from energy think tank Ember shows advances in geothermal technology have driven costs down. Mapped by technological potential, Ember's estimates suggest 43GW of geothermal capacity in Europe currently offers lower costs than gas-powered electrcity.
