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Increasing investor’s appetite for German Geothermal

Increasing investor’s appetite for German Geothermal Drilling rig at Kirchweidach, Bavaria, Germany - this picture is not related to the story (source: Herrenknecht)
Alexander Richter 9 May 2017

International consortium from Austria acquiring geothermal project in the Bavarian Molasse Basin, Germany, showing the increasing interest of investors in geothermal projects in the region.

The low temperature geothermal resources found in Germany, are by far not as attractive as high temperature resources in Italy, Turkey or Latin America. However, a high feed-in-tariff of about EUR 0.25/ kWh (approximately $ 0.275/ kWh) until the end of 2020 for a guaranteed 20 years from the start of energy production make the region highly attractive. Furthermore, the stable political conditions and a tremendously large reservoir of low mineralised thermal water, provide a great perspective for the Bavarian Molasse Basin. The projects’ success rate is also highly interesting, with only one out of 60 wells failed so far.

Italian energy giant Enel entered the market in Germany one year ago with the Weilheim project, highlighting the fact that the Bavarian Molasse Basin becomes more and more interesting for investors. The project of Geretsried, after experiencing a dry well, has found a new partner in Auctus Capital, which will help continue and finish the project with a side-track and second well to be drilled. The drilling has started recently supported by a risk insurance.

Today, another acquisition was announced. Austrian construction company Strabag and the energy supplier EVN AG have bought the geothermal project in Bruck, in the eastern part of the Molasse Basin. In the surrounding of Bruck, several chemical factories and a brewery also facilitate heat supply in addition to the electricity production. The ready-to-drill project was sold by Geoenergie Bayern Verwaltungs GmbH. The former susidary Geoenergie Bayern GmbH was involved in the construction of the neighbouring Kirchweidach project, famous for the greenhouse operations connected to the project. This project’s shares of Geoenergie Bayern were sold together with the company about a year ago.

The next few months are going to be exciting. Additional projects in the region are ready to drill, offering interesting opportunities.

The deal was approved by the European Commission, as reported today by Energy Live News.

This and much more will be discussed at the upcoming Praxisforum Geothermal.Bayern geothermal conference in Munich, 11-12 September 2017. The event will feature discussions on the market, its opportunities and outlook, as well as the experience of investing into geothermal energy projects, among others by investors such as Auctus Capital.

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Source: Dr. Jochen Schneider/ LinkedIn