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PLN 250 million for the development of geothermal energy in Polish municipalities

11.05.2022

The National Fund for Environmental Protection and Water Management (NFEPWM) will increase the budget of the “Enabling access to thermal waters in Poland” programme, from PLN 300 million to PLN 480 million. Thus, the allocation of the current second call for applications will also increase from PLN 70 to 250 million and, at the same time, the deadline for submitting applications will be extended until 30 September. This optimistic information for local governments planning making investments in geothermal energy was provided today (11 May) by the Minister of Climate and Environment Anna Moskwa – in Sieradz, where in the years 2018-2019 an exploratory borehole was drilled thanks to the funds from the NFEPWM, and currently the construction of a modern geothermal and biomass heating plant is already underway.

PLN 250 million for the development of geothermal energy in Polish municipalities

Since the geothermal potential of Poland covers almost half of the area of our country, the interest of local governments in exploring thermal water deposits in their area, and then using this renewable energy source for heating flats, houses, companies and public buildings is constantly growing. Only from the beginning of 2022, the Polish Geological Institute – National Research Institute (PGI - NRI) issued 150 preliminary opinions to municipalities on the occurrence and possibility of managing thermal waters in the indicated locations, whereby 65 of them received positive recommendations. In order to meet the needs of local governments, at the request of the Minister of Climate and Environment, the NFEPWM decided to increase the budget of the priority programme entitled “Enabling access to thermal waters in Poland” by nearly 55% – from PLN 300 to 480 million.

We consistently focus on the development of renewable energy sources in Poland, and rich, natural and native geothermal resources are an important component of the general RES balance – stresses the Minister of Climate and Environment Anna Moskwa. – Geothermal energy provides “clean”, emission-free energy, which is of particular importance in our intense efforts to protect the climate and improve air quality in the country. At the same time, this source of energy is very stable source, independent of seasons and weather conditions, and neutral for the landscape. That is why we want to support local governments even more extensively and effectively in implementing geothermal investments. We assume that increasing the budget for exploring local thermal water resources will contribute in the future to a significant increase in the use of a prospective, zero-emission source of heat and electricity, which geothermal energy is

– adds the Head of the Ministry.

As part of the ongoing second call for application under the “Enabling access to thermal waters in Poland” programme, the National Fund for Environmental Protection and Water Management initially allocated PLN 70 million to local governments or their associations for projects in the field of prospecting and exploration of underground hot water deposits. The current increase in the budget of the entire programme meant that the pool of money in the current call will also be increased to PLN 250 million. An additional facility for municipalities will also be the fact that the call, which was to last from 3 January to 30 June 30, will be extended. Municipalities will have time until 30 September 2022 to submit applications. Both decisions mean a response to the expectations of potential beneficiaries who need more time to make geothermal investments, but, above all, more financial resources, as the very execution of exploratory drilling sometimes costs even up to a dozen or so million PLN.

We finance the first exploratory borehole in 100% in the form of grants, being aware of the fact that work on an undocumented thermal water deposit poses a significant financial risk for local governments.

– emphasises the Deputy Minister of Climate and Environment, Chief National Geologist, Piotr Dziadzio.

Through the full, non-repayable support, we reduce this sense of uncertainty, which is of key importance for municipalities in making decisions on geothermal investments. And the number of interested parties is constantly growing, which results from the exploration of the geological structure and confirmed thermal water resources with already made boreholes. This gives rise to the claim that hot water from the Earth’s interior can be drawn in Poland not only in Podhale, where geothermal energy is already well developed, but also on an extensive strip stretching from Western Pomerania to the Świętokrzyskie Mountains.

– adds the Deputy Head of the Ministry.

A good example of successful investing in geothermal energy is Sieradz, a city in central Poland, where it is no accident that Minister Anna Moskwa announced an increase in the government support for municipalities and their associations for enabling access to thermal waters. The Sieradz local government, as a beneficiary, received a grant of almost PLN 10.5 million from the NFEPWM under the first part of the 2.3 Geology and Mining programme under the name “Understanding the geological structure of the country and the management of mineral and groundwater”. With this money, from January 2018 to January 2019 the city explored and documented the thermal water resources in its area by making a Sieradz GT-1 exploratory borehole with a depth of 1,505 m. The result turned out to be promising – the efficiency of the deposit is 249 m3 per hour, and the temperature of water is 51.8°C.

The Łódzkie Voivodeship focuses on green energy. We want to continue investing in and developing green projects. Our company, Łódź Agglomeration Railway, is the first railway company in the country, which today in 30%, and ultimately in 100%, is powered by green energy. We also have some of the most famous geothermal pools in the whole country, located in Uniejów and used by residents from all over Poland. Now, thanks to the government programme, the residents of Sieradz will use geothermal energy to heat their flats, while taking care of ecology and their health.

– says Grzegorz Schreiber, Marshal of the Łódzkie Voivodeship.

The next step of the Sieradz local government is the construction of a geothermal and biomass heating plant with a Sieradz GT-2 injection borehole and – additionally – the construction of a co-generation module with a capacity of 0.9 MWe and 1.1 MWt, which, through the energy use of biomass in the form of woodchips, will support, particularly in winter, the operation of the future heating plant based on the thermal water deposit. For both these projects, aimed at reducing significantly the level of emission of the Sieradz heating system, the local Thermal Energy Company also received co-financing from the NFEPWM – in the form of grants from the Infrastructure and Environment Operational Programme 2014-2020 (almost PLN 68.7 million for the heating plant and more than PLN 4.1 million for co-generation) and loans from the national funds of the National Fund (respectively: PLN 53.4 million and almost PLN 3.9 million).

The example of Sieradz shows how ecologically important and economically promising a source of thermal energy is geothermal energy, which will allow, to a large extent, to eliminate the emission of harmful substances into the atmosphere, while providing the city with a stable heat supply.

– highlights Artur Michalski, Vice-President of the National Fund for Environmental Protection and Water Management.

In the Sieradz heating system, the use of coal-fired boilers will be significantly reduced by including a new, geothermal and biomass heat source, using high-efficiency co-generation. It is a measure to protect the climate and the environment, and, at the same time, a method to reduce the costs of energy production. Through the financial support addressed to local governments, we want to popularise this model of heating in every place in Poland where a geothermal potential exists.

– adds the Deputy Head of the NFEPWM.

In the future, the construction of further heating plants in Poland using local thermal water resources will be a difficult to overestimate consequence of investing in research and exploration works, which – thanks to the current increase of the programme budget by PLN 180 million – will become even more dynamic soon. It is also worth recalling that in the years 1995-2022 the National Fund for Environmental Protection and Water Management provided in total its financial support to 46 projects consisting in the prospecting and assessment of the abundance of underground hot water deposits. The total amount of grants granted at that time to local governments for the construction of geothermal exploratory boreholes stood at PLN 583.5 million. The Sieradz project, presented here as an example, was one of 11 research projects co-financed by the NFEPWM in the years 2016-2022 from geological programmes.

The priority programme “Enabling access to thermal waters in Poland”, implemented from 2020, after the current increase in its allocation by almost 55% (PLN 180 million), will become available to even more local governments planning to invest in geothermal energy. It should be mentioned here that in the first call for applications, which lasted from 15 April to 30 September 2020, the Minister of Climate and Environment gave a positive opinion on 15 applications for co-financing. On this basis, the NFEPWM allocated almost PLN 229.2 million for grants, and the following municipalities or cities received support: Dębno, Gąsawa, Głuszyca, Gniezno, Inowrocław, Jasienica, Łowicz, Oława, Otwock, Piastów, Smyków, Trzebnica, Wągrowiec, Wołomin and Żyrardów.

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The National Fund for Environmental Protection and Water Management (NFEPWM) is a leader in implementing programmes which change the quality of life in Poland for the better. For more than 30 years, it has been initiating and supporting measures for the environment and energy transition. The institution, subordinate to the Ministry of Climate and Environment, finances and co-finances green projects. It has already allocated PLN 270 billion for this purpose, of which almost 2/3 are own funds. Its support is used by entrepreneurs, local governments and state administration, as well as universities, non-governmental organisations and private individuals.

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