1

Energy performance strategies for the large scale introduction of

geothermal energy in residential and industrial buildings: the

GEO.POWER project

Giambastiani B.M.S.1, Tinti F.

2, Mendrinos D.

3, Mastrocicco M.

1*

1 Physics and Earth Sciences Department, University of Ferrara, Via Saragat 1, 44122

Ferrara, Italy

2 Department of Civil, Chemical, Environmental and Materials Engineering (DICAM),

University of Bologna, Viale Risorgimento, 2 – 40136 Bologna (Italy).

3 Center for Renewable Energy Sources and Saving (CRES), 19

th km Marathonos

Avenue - 19009 Pikermi-Attica (Greece).

* Corresponding author at: Physics and Earth Sciences Department, University of

Ferrara, Via Saragat 1, 44122 Ferrara, Italy. Tel.: ++39 0532 974692, Fax: ++39 0532

974767. E- mail address: mtm@unife.it (Micòl Mastrocicco)

Abstract

Use of shallow geothermal energy, in terms of Ground Coupled Heat Pumps (GCHP)

for heating and cooling purposes, is an environmentally-friendly and cost-effective

alternative with potential to replace fossil fuels and help mitigate global warming.

Focusing on the recent results of the GEO.POWER Project, this paper aims at

examining the energy performance strategies and the future regional and national

financial instruments for large scale introduction of geothermal energy and GCHP

systems in both residential and industrial buildings.

After a transferability assessment to evaluate the reproducibility of some outstanding

examples of systems currently existing in Europe for the utilisation of shallow

2

geothermal energy, a set of regulatory, economic and technical actions is proposed to

encourage the GCHP market development and support geothermal energy investments

in the frame of the existing European normative platforms. This analysis shows that

many European markets are changing from a new GCHP market to growth market.

However some interventions are still required, such as incentives, regulatory

framework, certification schemes and training activities in order to accelerate the market

uptake and achieve the main European energy and climate targets.

Keywords: shallow geothermal energy; action plan; ground coupled heat pumps

1. Introduction

Worldwide, the share of thermal energy use (both heating and cooling) accounts for

about 47% of global consumer energy demand, much greater than final energy for

transport (27%), electricity (17%) and non-energy use (9%) (IEA, 2011). Despite the

importance of the heating and cooling sector, renewable energy technologies currently

supply only a small percentage of global and European heat demand per year (Seyboth

et al., 2008; EC, 2012).

The vast majority of heat is currently being generated by burning fossil fuels, whereas

cooling is still predominantly produced from electricity-driven processes and, therefore,

also largely relies on coal or gas (EGEC, 2012). Globally, in 2009 natural gas accounted

for about 27% of the fuel mix for heating, combustible renewables and waste

represented 26%, oil about 19% and coal and peat 20%. In the same year commercial

heat provided 6.5% of heat production, while the share of geothermal and solar heat was

0.5% (IEA, 2012).

Renewable heat can be generated in a number of ways. In general, renewable heat

policy support addresses technologies producing direct heat coming from solar energy,

3

bioenergy, geothermal energy and ambient energy. Geothermal energy is one of the

most environmentally-friendly and cost-effective energy sources with potential to

replace fossil fuels and help mitigate global warming as well.

The IPCC Special Report on Renewable Energy Sources and Climate Change

Mitigation (IPCC, 2012) predicts the annual global CO2 savings from renewable energy

technologies in four deployment Scenarios for 2030 and 2050, and highlights the good

potential of the geothermal energy in reducing the greenhouse gas (GHG) emissions.

Recent technological progress, the variability of the cost, the difficulty of oil and gas

supply from foreign countries and the need to reduce the use of fossil fuel to cut

pollution have made the exploitation of geothermal energy, especially Ground Coupled

Heat Pumps (GCHP) for heating and cooling purposes, an attractive and viable energy

alternative (Sanner et al., 2003). In fact, compared to other competitive technologies for

heating, the environmental impact in terms of energy consumption and GHG emissions

for the installation and operation work of modern GCHP systems is modest (Chiavetta

et al, 2011).

Regarding the situation in Europe, a broad diffusion of geothermal energy could bring a

concrete contribution to decarbonise the European economy and meet the targets of

reducing GHG emissions by 20% by 2020 and by 80-95% by 2050 (compared to 1990

levels) as indicated by the EU Energy 2020 (EU, 2010b) and Energy Roadmap 2050

(EU, 2011), respectively. In the Renewable Energy Road Map (EU, 2006), the

European Commission encourages member states and their local authorities to apply

and implement concrete measures in order to improve energy production and

distribution, to facilitate investment in the green sector, and to encourage and

consolidate rational energy consumption behaviour with the final aim of making Europe

the world leader in renewable energy and low-carbon technologies. However it is

pointed out that the geothermal energy sector is not doing enough to exploit the

4

potential of Renewable Energy Sources (RES), emphasising that increased electricity

and heat generation from geothermal resources will partially avoid the need for new

fossil fuel power generation. Geothermal heating and cooling still require research and

development over the next few years, notably to further improve the efficiency of the

systems and to decrease installation and operational costs. However, the main barrier to

augment geothermal deployment is a lack of appropriate financial incentives and

legislation on both EU and local level. This could limit the achievement of European

policy objectives in relation to EU “20/20/20 targets” (EU, 2010b), the Renewable

Energy (2009/28/EC; EU, 2009) and the Recast Energy Performance of Buildings

(2010/31/EU; EU, 2010a) directives, as well as the international climate agreements

signed in Kyoto (UNFCCC, 1998) and Copenhagen (UNFCCC, 2009).

It is against this background that geothermal energy will play a much more important

role in the future and will contribute to achieving all major objectives of the EU energy

policy. This paper is based on the recent GEO.POWER Project results. The 26 month

project (Nov. 2010 – Dec. 2012) aimed to evaluate the reproducibility and

transferability of some of the most outstanding examples of Best Practices (BPs)

currently existing in Europe for the utilisation of shallow and low-enthalpy geothermal

energy, mainly related to the GCHP systems. The paper examines the energy strategies

and the future regional and national financial instruments for the large scale introduction

of GCHP in the Project members’ regions. It explains how to fill in some legislation and

financial gaps concerning energy and GCHP investments, illustrating some possible

pathways towards low-carbon energy systems in Europe.

5

2. Methodology

2.1 GEO.POWER Project

The GEO.POWER Project (“Geothermal energy to address energy performance

strategies in residential and industrial buildings”) was co-financed by the European

Regional Development Fund in the frame of the INTERREG IVC Programme. The

partnership is composed of twelve partners (PPs) from nine EU countries under the

coordination of the Province of Ferrara (Italy) (Fig. 1).

The general project objective was to exchange the PP’s own experiences on heating and

cooling supply mainly through GCHP but also from low enthalpy geothermal energy,

and, after a technical and cost-benefit assessment, to evaluate the reproducibility and

transferability of the BPs currently existing in Europe (Giambastiani and Mastrocicco,

2011). The necessary implementation measures were outlined in one action plan per PPs

to be later on financed through regional and national mainstream programmes. Each

action plan provided an organized set of legal/regulatory, economic and technical

proposals: (i) to fill in the legislation gaps in the geothermal energy sector; (ii) to

address long-term investments strategy for GCHP application for residential and

industrial buildings at wide scale, and (iii) to outline an integrated package of final

incentives and subsidies schemes in the frame of the forthcoming Regional Operational

Programme (after 2013), where large amount of funds will be dedicated to co-finance

energy efficiency and carbon-free energy projects.

6

Fig. 1. The countries of GEO.POWER project partnership: Province of Ferrara, and Emilia-Romagna

Region (Italy); VITO Flemish Institute for Technological Research (Belgium); Reading Borough Council

(United Kingdom); SP Technical Research Institute, and KTH Royal Institute of Technology (Sweden);

Institute of Geology – Tallinn University of Technology (Estonia); ENEREA - Ѐszak-Alföld Regional

Agency, and Energy Centre (Hungary); Ministry of Regional Development and Public Works (Bulgaria);

Centre for CRES - Renewable Energy Sources and Saving (Greece); GeoZS – Geological Survey of

Slovenia (Slovenia).

2.2 Project phases

The GEO.POWER project consisted of three phases:

Phase 1 (Nov. 2010 - May 2011) regarded a review of the BPs achieved within the

GCHP sector and their possible application as a sustainable heating/cooling technology.

Expertise was shared and exchanged within the PPs and local delegations (composed by

energy managers, technicians, stakeholders, urban planners, etc.) and twelve BPs were

selected according to the following criteria: field of application (residential or

commercial); type of systems (vertical closed loop with boreholes – BTES - Borehole

7

Thermal Energy Storage, open systems with production and reinjection wells – ATES –

Aquifer Thermal Energy Storage, horizontal closed loop systems); hydrogeological

setting; type of building (new buildings, renovations, etc.); efficiency parameters (COP,

EER, SPF, SEER, etc.); quality of the monitoring scheme; integration with other RES;

benefits (energy saving, avoided emissions, payback timeframe, etc.); and level of

supposed transferability.

Phase 2 (Jun.-Dec. 2011) concerned the assessment of the reproducibility and

transferability of the selected BPs in each recipient region. In this phase all partners

went through a SWOT analysis and transferability assessment to recognize advantages

and disadvantages of the application/adaptation of the identified GCHP technologies in

their own territories, based on the local technical, economic and environmental situation

(Rizzi et al., 2011). The SWOT analysis is based both on an internal analysis which has

the objective to carefully define Strengths (S) and Weaknesses (W) of the selected BPs

with the purpose to define the technical aspects of the application (energy efficiency,

reliability, economic efficiency, etc.), and on an external analysis, concerning

Opportunities (O) and Threats (T) of the PPs’ target areas where the selected

technologies could be promoted for future replication (Fig. 2). The external analysis is

the evaluation of the local market (market segment size, price sensitivity, government

subsidies and incentives, etc.), environment (impact, suitability of boundary conditions,

government regulations, etc.) and vulnerability to competitors (selling power,

competing energy sources and plant technologies, financial resources, etc.)

(Giambastiani et al., 2012). Weighting factors were assigned to each component of the

SWOT analysis. In order to assess the transferability of the selected examples, each

weighting factor value was multiplied by a score, according to its degree of

transferability (from 2 for “very high transferability” to -2 for “very poor

transferability”). Each example of best practice was then given a rank and its

8

transferability was assessed. This unified methodology allowed the comparison of

SWOT analyses among all PPs.

Fig. 2. Scheme of the SWOT analysis used in phase 2 of the project.

Phase 3 (Jan.- Dec. 2012) consisted of the elaboration of an action plan for each

involved region to support policymakers’ commitment. The action plans pave the way

towards the transferability of the selected and adapted BPs into the Mainstreaming

Programmes and energy regulations plans. The main target group of the action plans are

the competent Managing Authority (MA) of the European Regional Development Fund

(ERDF; EU, 1999) that are in charge of profiling investment strategies and incentives in

order to promote the large scale introduction of GCHP in their own regions.

3. Results

The result of the first phase of the project is reported in Table 1. Twelve BPs were

selected in different sectors: four in the public, four in the industry, three in the private

and one in the agriculture sector. More detailed information on these case studies can be

found on the project website (http://geopower-i4c.eu/).

Table 1. Case studies selected as BPs and their brief description. To be noted: the BPs are listed based on

their transferability potential (from the most transferable to the least transferable) calculated by SWOT

analysis.

9

SWOT

ranking

Case study GCHP sector Description

365 TELENOR

Headquarter in

Törökbálint,

(Hungary)

Industry

sector and

cross-cutting

fields

New industrial building; 180 Borehole Heat

Exchangers (BHE) drilled 100 m deep for cold and

hot water, therein regulating temperature in the

building; solar collectors (168 m2) supply the 60-70%

of the hot water demand; the energy efficiency of the

building is controlled by an intelligent building

management system that allows efficient

measurement and control of various equipment

parameters; high efficiency insulation and external shades during summer.

Efficiency: CO2 emission saving = 800-850 tons;

energy saving = 2.1 million kWh; payback time = 8-

10 years.

348 Greenhouse near

Antwerp

(Belgium)

Agriculture

sector

Semi-closed greenhouse with an area of 13500 m2;

the air handling unit conditioning is coupled to a

Borehole Thermal Energy Storage (BTES; 2 wells

140 m deep and 200 m distant each other), a gas

absorption heat pump and an oil boiler as back-up.

The choice of gas absorption derives from the need of

having a continuous CO2 provision, which is brought

into the greenhouse for maturing, stays inside longer, resulting in an expansion of the season of cultivation.

Overheating is minimized by introducing a cooling

system into the greenhouse. The heat pump is used,

combined with the ground source closed loop system:

during winter, the heat pump tries to cover the

heating demand of the greenhouse. The cold at the

evaporator is stored into the cold well. This 'stored'

cold is used during summer to cool down the

greenhouse. If necessary, the heat pump can deliver

additional cold, while the heat will be stored into the

warm well.

Efficiency: CO2 reduction = 34%; EER (cooling) = 9-40; SPF (heating) = 5; average SEER (combination of

free cooling and cooling provided by the reversible

heat pump) = 18.

286 Hotel "Amalia",

Nea Tiryntha

(Greece)

Industry

sector and

cross-cutting

fields

Total area of 8980 m2; open-loop heat pump system

for heating and cooling; two brackish groundwater

supplying wells (60 m deep) and two reinjection

wells (60 m deep), two titanium heat exchangers and

two electric water source heat pumps placed in

cascade.

Efficiency: energy saving = 70%; cost saving = 67%;

payback time = 4.7 years; expected life-time = 30

years; SPF (heating) = 4.54; SEER (cooling) = 3.65.

284 District Heating System in

Ferrara (Italy)

Industry sector and

cross-cutting

fields

Integrated Energy System in which the energy from the Waste Treatment Plant is added to the geothermal

source. Geothermal fluid (hot water at 100°C) is

pumped from depths of 1000 m; the hot water

transfers thermal energy to the heating system. Then

the water is re-introduced into the ground to ensure

the geotechnical stability. Integrated Energy System

(geothermal source + energy from the Waste

Treatment Plant).

Efficiency: use of renewable energy = 83%; CO2

emissions avoided = 40000 tons.

275 Block of flats in

Budapest

(Hungary)

Private sector A ten-story panel building with 256 flats;

Insulation with new energy efficient windows and

controllable heating; open loop system with 4 wells and 6 injection wells (14 m deep);

10

Three heat pumps (434 kW for heating, 245 kW for

domestic hot water supply).

Efficiency: COP > 4.45; SPF = 3.2; cost saving =

47%

264 Headquarters

INFRAX in

Torhout

(Belgium)

Public

building

Sustainable office project with several eco-innovative

technologies; integrated photo-voltaic elements, slab

heating and cooling and a ground coupled heat pump

of 160 kW combined with a BTES system (24

vertical borehole heat exchangers 130 m deep).

Building skin is constructed in order to avoid heating

in winter and cooling in summer, then the remaining energy demand is covered by a very efficient

renewable energy system, and the energy peak is

covered in a traditional way.

Efficiency: GHG emission reduction = 32%; energy

saving = 37%; payback time = 10 years.

247 Two-family

house in Pikermi

(Greece)

Private sector Area: 180 m2; insulation with the use of synthetic

windows with double glass and Argon gas in-

between; open loop system: the heat pump feeds the

under-floor system with warm or cold water for

heating or cooling accordingly. Two extra ceiling

dehumidifiers are placed in the two floors of the

residence (each in every floor); the dehumidifiers are used only in cooling mode during summer, they are

commanded by a wall humidity sensor and dry the air

when needed, thus operating complementary to the

floor-cooling. These dehumidifiers are water chilled

with the under-floor water.

Efficiency: primary energy savings compared to the

conventional means (i.e. natural gas) = 30-40%;

payback time = 10 years; expected life-time = 30

years; COP (heating) = 5.8; EER (cooling) = 6.1; SPF

(heating) = 4.8; SEER (cooling) = 3.6.

240 The Avenue

Centre in

Reading (England)

Public

building

Shared-occupancy building comprising a special

needs school and office accommodation; high heat

demand building; combined installation of water/ heat pumps linked to a ground-source heat installation for

primary heat generation; summertime under floor

cooling using borehole water via a plate heat

exchanger for cooling. The installation is comprised

of an array of 70 to 80 m boreholes that accommodate

the closed loop pipes in a conductive grout. These are

connected to two heat pump units which extract the

available heat and circulate it at useful temperature

through the building heating system. Efficiency: “zero carbon” building.

234 Polytechnic

Institute of Setùbal

(Portugal)

Public

building

GCHP (closed loop) for heating and cooling of 22 m².

The distribution system consists of fan-coils with two tubes with the supply/return temperatures 7ºC/12ºC

for summer, and 45ºC/40ºC for winter.

Efficiency: primary energy savings compared to the

conventional means (i.e. natural gas) = 30-40%; COP

(heating) > 5.5; EER (cooling) > 15.35.

202 Stockholm

Arlanda Airport,

Sweden

Industry

sector and

cross-cutting

fields

The aquifer that supplies space cooling and heating

for Arlanda Airport is the world largest energy

storage unit; during the summer, the aquifer supplies

cooling to the airport buildings while at the same time

storing heat. In winter, the stored heat is used in the

ground heating system at the airport aircraft parking

stands for snow melting, and to pre-heat ventilation

air in buildings. Efficiency: Total annual electricity consumption =

11

19GWh; SPF close to 100; payback time = 5 years.

183 One-family

house, Ohlsdorf

(Austria)

Private sector Area: 189 m²; the installation is operated using no

backup heating system and is connected to the heat

distribution system without buffer storage; floor

heating; Geothermal horizontal coils (6 circuits 75 m

long for a total area of 270 m2 and 1.2 m deep),

connected to a direct expansion to water heat pump;

supply temperature: 35°C and return temperature:

30°C; the domestic hot water is heated by a separate

air-to-water heat pump which uses the air of the

surrounding air in the cellar. Efficiency: CO2 emissions reduction compared to a

gas boiler and oil boiler = 49% and 60%,

respectively; energy savings = 60%; SPF (heating) =

4.1.

Not

applicable

because not

chosen

GCHP market

in Sweden

Public

buildings and

Private sector

From small houses with one borehole to larger multi

dwelling houses requiring several boreholes; GCHPs

used with borehole heat exchangers; the boreholes are

typical 100-200 m deep with ungrouted single-U

tubes immersed into shallow water table.

Efficiency: payback time = 7-8 years; COP = 6.

Considering the SWOT analyses and transferability assessments of all PPs, the most

transferable example of technology are the TELENOR building (Hungary) and the

Greenhouse in Antwerp (Belgium), while less transferable ones are the 1-family house

in Ohldshorf (Austria) and the Arlanda airport (Sweden) (Table 1).

The core results achieved by GEO.POWER project have consisted of the elaboration of

eight action plans to encourage the GCHP market. Based on the local legislative and

economic situation, as well as on the market potential, each PP has developed its own

document and suggested different strategies for GCHP implementation. The action

plans provide the MA of the ERDF with an organized set of initiatives to address long-

term investments strategy for GCHP applications at wide scale (Fig. 3). The summary

of the main actions proposed in the action plans by each PP are summarized in Table 2.

12

Fig. 3. Scheme representing the step from action plans to investments.

Table 2. Actions introduced in the action plans by the PPs. (Right column lists the PPs that have included

the action, reported on the left column, in their document.).

Action PP

Subsidies and subsidized tariff (preferential electricity tariff for operation of heat

pumps; geo tariff system; GCHP subsidies for large-scale project and innovative

systems)

GR, UK, HU, SI

Financial, tax, and incentive incentives GR, EE, SI

Certification scheme for drillers and installers GR, UK, EE, BE

Certification scheme for high quality design and installation UK

Promote the use of GCHP in social housing, communities, and public sector UK

Promote the use of GCHP in the agricultural sector (i.e. greenhouse for vegetable and fruit)

SE

Smart grids and heat storage UK

Development of demonstration project to demonstrate the technical performance

and economic feasibility

BE

Research and innovation (clean tech innovation; clean tech SMEs; exploration

and exploitation)

SE, IT, BE

Decision Support Methodology to support the increase of the GCHP (i.e.

Applicability Atlas for GCHP; GCHP register and database)

HU, IT, BE

Setting up regional Energy Agencies to assist stakeholders HU

Clear regulatory framework (regulatory simplification and ad hoc legislation for

GCHP)

IT, EE, BE

Improvement of administrative procedures SI

Public awareness; communication/information campaigns; dissemination

activities

GR, UK, HU, SE, IT,

EE, BE

4. Discussion

The SWOT analysis and transferability assessment highlighted that the choice of a

specific GCHP installation is determined primarily by the ability to achieve optimal

efficiency with lowest possible energy consumption and to meet the needs of

consumers. The strengths of the high transferability of geothermal systems lie in the

energy efficiency, avoided GHG emissions and small environmental impact of the

13

application. Energy efficient solutions, such as heat pump systems coupled with flat

plate collectors for sanitary hot water production, and intelligent building management

to control the equipment parameters (such as in the Telenor building in Hungary, Table

1) are transferable into several typologies of buildings (medium-small size houses,

offices, etc.). Also the degree of innovation and ‘green’ engineering solutions are

appreciated by end users, especially in the agricultural sector (such as the example of

the greenhouse in Belgium, Table 1) where low enthalpy geothermal energy has big

replication potential (Adaro et al., 1999; Karytsas et al., 2003; Kondili and Kaldellis,

2006, IEA, 2006). Many existing greenhouses, which currently use conventional

heating/cooling systems, could be converted into a more energy efficient system, thus

reducing GHG emissions and leading to cost reductions. This would also satisfy the

investor interest, who can make higher profits from selling out of season vegetables and

fruits instead of importing them. In this specific sector, some limits could be represented

by the applicability in different climate conditions (if winter temperatures are too low

more energy is needed for cultivation and so the energy efficiency is compromised) or

by the reluctance of some farmers to abandon the old production system and cultivation

techniques. Moreover, in some countries the market for this type of greenhouses is

relative small because of the environmental permits required for open loop system and

ATES technology (i.e. Italy), and because of the strong competition from international

large scale greenhouses which benefit from better climate conditions and the possibility

to produce vegetables at lower costs.

Besides the good energy performance and efficiency of the system, the applicability of

geothermal horizontal coils (i.e. 1-family house in Austria, Table 1) has some

limitations; the big area of free space needed for the installation of the ground heat

exchanger limits the applicability in densely built up areas and the degree of acceptance

for this technology.

14

Large infrastructure systems (such as the Arlanda Airport in Stockholm and the District

Heating System in Ferrara) resulted to be less easy to transfer due to the construction

size required, market-related, economic and technical reasons although the energy

efficiency is high, and the environmental impact very low. It appears that more

advanced and complex GCHP systems need more thorough transferability actions.

The SWOT analyses highlight that local markets for GCHP installations in all regions

of the project are characterized by neutral to positive market opportunities where limited

market segment, economy in recession (i.e. Italy, Bulgaria, Slovenia and Greece), rising

taxation and high price sensitivity are counterbalanced by increasing market growth

rates, increasing customer and investor interest, and high possibility to attract

cooperation and create new jobs. Countries with an early development of heat pumps,

such as Sweden, have a large share of electric heating and a high share of non-fossil

fuels in their power mix. In these countries, the oil crisis with rapidly rising energy

prices in the 1970’s became the driver for development of heat pumps. The introduction

of heat pumps was in this context a measure of saving oil and increasing the use of

domestic energy (SEA, 2005). However, use of shallow geothermal energy is still

underestimated in many countries (such as Italy and Hungary) taking the corresponding

potential into consideration.

Table 3 lists the main Strenghts & Opportunities (SO) and Weaknesses and Threats

(WT) for the GCHP systems to enhance the overall understanding of the state-of-the-art

of GCHP in the PPs’ regions, as it come out from the SWOT analysis.

Table 3. Summary of the Strenghts & Opportunities / Weaknesses & Threats for the GCHP systems.

Strenghts & Opportunities Weaknesses & Threats

Energy efficiency and performance Competition with conventional energy sources

(gas and oil)

Avoided gas emission Lack of incentives and government regulations

(in some countries, cfr. text)

Small environmental impact Upfront investment costs and risk before the

payback time

15

Degree of innovation Market size: high price sensitivity, economy in

recession (2011-2013), rising taxation

Cost saving (reduced use of gas and electricity) Lack of political support (some countries, cfr.

text)

Applicability to different climate and

hydrogeological conditions

Reluctance in abandoning the old production

system

High potential for cooperation and job creation Lack of knowledge (in some countries, cfr. text)

Increasing customers and investors interest

On a country-by-country basis, there are 3 types of GCHP sectors: (i) mature markets,

such as Sweden, where there is considerable market penetration and the market is

supported by codes of practice, standards and training; (ii) growth markets, such as

Greece, United Kingdom, Italy, Estonia and Belgium, where end users are becoming

more and more aware of the merits and benefits of GCHPs and more brands are entering

the market, and (iii) new markets, such as Hungary, Bulgaria and Slovenia, which need

considerable interventions and support to build awareness of the newly introduced

technology.

In the new markets, the main threat to the development of long-term investments for

GCHP applications is the lack of government regulations and significant incentives for

renewable energies, which is more profound in the field of geothermal energy. Despite

the fact that geothermal heat pumps have been in use for over 60 years now, market

barriers are still significant, with fossil fuels dominating the space heating market and

air-to-air heat pumps that of space cooling (Sanner et al., 2003). Based on the analysis

by Sanner et al., (2003), the main barriers to GCHP market penetration lie in the high

costs, requirement of qualified engineers and contractors for the system installation, and

in the limited efficiency and application with older heating systems installed in many

buildings all over Europe.

Government incentives or tax deductions are necessary to promote the use of heat

pumps; despite its high value, shallow geothermal energy cannot compete effectively

with conventional energy sources without significant financial and political support.

The global economic recession is the issue that may need the most attention. So, the set-

16

up of low electricity tariffs, and other incentives could help to overcome the sizeable

upfront investment costs and risks before the payback.

Other barriers for transformation of GCHP industry in the countries analysed have been

found in the large upfront investment cost, payback time and low awareness leading to

low demand (SEA/RENUE, 2005). In this context an efficient action plan needs to

develop a policy package that applies CO2 abatement action broadly across sectors and

encourages technology diffusion while coping with market and cost uncertainties and

securing public acceptance (IEA, 2012). Such a “policy mix” can be achieved through

the combination of several actions. The order in which each policy type is to be

implemented varies according to a country’s energy and economic structures, existing

policy frameworks and level of sustainability ambition.

Analysing the action plans developed in phase 3 of the project, it is possible to establish

a common interpretation and find general guidelines. In many cases geothermal energy

and heat pump systems are mentioned in the sustainable use of energy priority, energy

restoration and sustainable use of buildings, pilot projects, innovation, etc., but they are

neither explicit priority in the OP 2007-2013 nor in the forthcoming OP 2014-2020 of

all members’ regions. The development targets to 2020 vary in the concerned regions

but generally there is an up-growing trend in the GCHP installations. The main target

group is the competent MA of the Structural Funds that will be in charge of defining

investment strategies and managing funds and incentives. Moreover, the action plans

must be agreed and supported by the relevant stakeholders (companies, municipalities,

nongovernmental organizations, public institutes, technicians, engineers, research

institutes, SME enterprises, etc.) in each of the participating region.

The analysis of the action plans shows some general and common approach to address

GCHP large scale investments. One of the most relevant core actions concerns adopting

incentives and increasing the existing ones for both shallow (GCHPs) and deep

17

geothermal applications. This includes, for instance, financial incentives during the

start-up phase for both domestic and commercial sector, tax releases or tax credits for

commercial companies and households, low cost loans, and discounted electricity tariffs

for energy saving derived by use of GCHP systems. It is also concluded that the

introduction of GCHP systems will only be competitive if the consumer energy price

ratio (electricity prices divided by fuel prices) is kept reasonably low; investment

subsidies can open a market for GCHP, but if the energy price ratio is not good enough

when the subsidies are withdrawn, the market will probably decline to previous levels.

Very important is also the introduction of additional support (e.g. tax rebate and GCHP

subsidies) for large and innovative systems (ATES, BTES, smart grids, renovations,

district heating systems, etc.). Although the institutions (public and private) in charge of

the schemes to incentivise the diffusion of the GCHP technology have been identified in

most of the project regions, the efficiency of the financial incentives themselves are not

always well known. Financial incentives are not often based on the energy effectively

delivered, CO2 reductions, etc. In this case reliable and comparable statistics are

suggested as well as a quantification of the progress towards national targets.

Another essential action of the project GEO.POWER was to show and prove the

economic feasibility and technical performance of GCHP by quantifying energy

delivery, and by selecting a number of demonstration projects that have been monitored

over a long time period in order to objectively demonstrate the efficient GCHP

contribution to renewable energy sources. The best way to convince potential investors

is to show that geothermal applications work in a reliable and economically feasible

way.

In order to improve system efficiency and life of installations, it has been proposed to

develop recommendations and guidelines for hydrogeological studies and GCHP system

design together with the introduction of certification schemes for drillers and installers

18

and for high quality design and installations. Quality certification schemes, such as the

pan-European QualiCert scheme (IEE, 2011) can assist in bringing together different

qualification requirements and build customer confidence in registered installers.

Particular attention needs to be paid to the new build market where a certain amount of

energy efficiency and renewable energy measures should be guaranteed to obtain

planning permission.

Another of the recommended actions deals with the introduction of legislative measures

to outline a clear regulatory framework for the installation of GCHP, and facilitate the

introduction of administrative procedures towards clear criteria.

Moreover, part of the fund needs to be invested in strengthening the geothermal

research for the characterization of low enthalpy resources, and for exploration-

exploitation of shallow and deeper aquifers. At the same time it will be necessary,

where it has not been already done, to collect all available geothermal data and set up a

database of GCHP to be used as information system and management tool by all

stakeholders. The updateable database should be based on the principles of the

INSPIRE Directive (2007/2/EC; EU, 2007), which aims to create a European spatial

data infrastructure for sharing environmental spatial information among public sector

organisations across Europe.

In addition, part of the fund has to be invested in technological development and clean

tech innovations to increase the energy efficiency of the applications.

Within all the above mentioned actions, also marketing measures (such as further

dissemination of best practices; promotion campaigns for improving public’s opinion

about GCHP; good training schemes for technicians, installers and engineers; and

communication with decision-makers) have been identified by all PPs as important

strategies to increase awareness.

19

5. Conclusions

The present paper is based on the results of the GEO.POWER project which highlights

the potentiality of geothermal applications for heating and cooling in residential and

industrial buildings. The paper describes the energy performance strategies and future

regional and national financial instruments that the project partners have developed for

the large introduction of GCHP in their respective territories.

The core results achieved by the GEO.POWER project focused on the elaboration of

action plans to encourage the GCHP market development in the frame of the existing

normative platforms and through the use of the EU Structural Funds in the current and –

above all – in the future Programming Period 2014 - 2020. All documents contain a set

of potential flanking measures to be implemented in the concerned areas to address

strategies for GCHP large scale introduction and subsidy schemes to support geothermal

energy investments. These action plans represent regional and – in certain cases –

national roadmap to budget resources, to figure out grant schemes and to overcome

technological and no-technological market barriers that – all together – could facilitate

the shallow geothermal energy deployment.

In conclusion, GCHP can effectively contribute to the achievement of the main EU

energy and climate targets. The SWOT analyses and the action plans show that flanking

measures, such as a regulatory framework, incentives, certification schemes and training

activities, are necessary in order to spur the market uptake across the EU. Many

European GCHP markets are on the cusp of changing from a new market to a growth

market. However transforming a market sector requires further interventions which

include legislative, economic, technical and marketing actions. Against this background,

some member states have developed ambitious targets for GCHPs, while some others

are still far behind this level.

20

Increasing awareness about geothermal energy and spreading the know-how so far

developed in some forefront countries is still crucial. This needs to be done along with a

radical rethinking of the heat market in which renewables could be placed on the same

footing as conventional and well consolidated technologies, including in terms of

knowledge, skills, market design and competition, and internalisation of external costs

into the final price. In order to compensate the advantages given to the oil and gas

sector, a series of supportive policies and subsidy schemes for the promotion of

geothermal and other genuine technologies needs to be in place with the final objective

to establish a marketing field of equal opportunities between fossil fuel and renewable

energy technologies.

Finally, marketing measures and the full involvement of all stakeholders and end users

have been identified as important strategies to increase awareness and effectively push

less experienced regions to invest in such green-economy, while more experienced

regions should be exposed to new ideas and practical solutions in the geothermal energy

field.

Acknowledgements

This study was co-financed by the European Regional Development Fund in the frame

of the INTERREG IVC Programme. We gratefully acknowledge the funding through

the GEO.POWER project, as well as all project partners for their collaboration and

scientific support during all phases of the project.

References

Adaro, J.A., Galimberti, P.D., Lema, A.I., Fasulo, A., Barral, J.R., 1999. Geothermal contribution to

greenhouse heating. Applied Energy, 64, 241-249.

21

Chiavetta, C., Tinti, F., Bonoli, A., 2011. Comparative life cycle assessment of renewable energy systems

for heating and cooling. Procedia Engineering, 21, 591-597

EC 2012. EU Energy in figures. Statistical pocketbook; European Commission.

EGEC, 2012. EGEC response to the EC public consultation on Intelligent Energy Europe III. European

Geothermal Energy Council, n. 699452134361703412.

EU, 1999. Regulation No. 1783/1999 of the European Parliament and of the Council of 12 July 1999 on

the European Regional Development Fund. Official Journal of the European Communities.

EU, 2006. Renewable Energy Road Map – Renewable energies in the 21st century: building a more

sustainable future. European Commission.

EU, 2007. Directive 2007/2/EC of the European Parliament and of the Council of 14th March 2007

establishing an Infrastructure for Spatial Information in the European Community (INSPIRE). European

Parliament, Council.

EU, 2009. Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the

promotion of the use of energy from renewable sources and amending and subsequently repealing

Directive 2001/77/EC and 2003/30/EC. Official Journal of the European Communities.

EU, 2010a. Directive 2010/31/EC of the European Parliament and of the Council of 19 May 2010 on the

energy performance of buildings (recast). Official Journal of the European Communities.

EU, 2010b. Energy 2020 - -A strategy for competitive, sustainable and secure energy. European

Commission.

EU, 2011. Energy Roadmap 2050. European Commission.

Giambastiani, B.M.S., Mastrocicco, M., 2011. GEO.POWER: a project to manage the growing demand of

low-enthalpy geothermal exploitation. In Proc. of Geoitalia 2011, VIII Italian Forum of Earth Sciences,

Torino, 19-23 September 2011. Epitome, Vol. 4, pag. 2.

Giambastiani, B.M.S, Pangallo, A.M., Tinti, F., Mastrocicco, M., 2012. Geo.Power project: SWOT

analysis and transferability assessment of Ground-Coupled Heat Pump (GCHP) systems into the Province

of Ferrara (Italy). In Proceedings: 7th EUREGEO – European Congress on Regional Geoscientific

Cartography and Information Systems, 181-182. Bologna (Italy), 12-15 June 2012.

IEA, 2006. Energy Storage Applications in Closed Greenhouses, IEA ECES concept paper, Canada

IEA, 2011. Energy Balances of non-OECD countries, OECD/IEA, Paris.

IEA, 2012. Policies for renewable heat – An integrated approach. IEA, Insights series 2012. OECD/IEA,

Paris.

22

IEE, 2011. QualiCert Publishable report – Quality certification & accreditation for installers of small-

scale renewable energy systems. Intelligent Energy Europe, 40 pp.

IPCC, 2012. Renewable Energy Sources and Climate Change Mitigation - Special Report of the

Intergovernmental Panel on Climate Change. Cambridge University Press, 1076 pp.

Karytsas, C., Mendrinos, D., Goldbrunner, J., 2003. Low enthalpy geothermal energy utilisation schemes

for greenhouse and district heating at Traianoupolis Evros, Greece. Geothermics, 32, 69-78.

Kondili, E., Kaldellis, J.K., 2006. Optimal design of geothermal-solar greenhouses for the minimisation

of fossil fuel consumption. Applied Thermal Engineering 26, 905-915.

Rizzi, F., Frey, M., Iraldo, F., 2011. Towards an integrated design of voluntary approaches and

standardization processes: an analysis of issues and trends in the Italian regulation on groun coupled heat

pumps. Energy Conversion and Management, 52(10), 3120-3131.

Sanner, B, Karytsas, C., Mendrinos, D., Rybach, L., 2003. Current status of ground source heat pumps

and underground thermal energy storage in Europe. Geothermics, 32, 579-588.

SEA, 2005. Heat-pumping technologies for a modern society. Swedish Energy Agency, ET2005:15.

SEA/RENUE, 2005. Barriers to Installing Domestic Solar Hot Water Systems. London: Sustainable

Energy Action /Renewable Energy in the Urban Environment.

Seyboth, K., Beurskens, L., Langniss, O., Sims, R.E.H., 2008. Recognising the potential for renewable

energy heating and cooling. Energy Policy, 36, 2460-2463.

UNFCCC, 1998. Kyoto Protocol to the United Nations Framework Convention on Climate Change.

United Nations Framework Convention on Climate Change, 21 pp.

UNFCCC, 2009. Framework Convention on Climate Change – Draft decision CO.15. United Nations

Framework Convention on Climate Change.