A pioneering project to produce power from hot rocks several kilometres under the ground in Cornwall will begin drilling early next year, if a multimillion-pound fundraising drive succeeds.
Abundance, a crowdfunding platform overseen by the main City regulator, will this week launch a bond to raise £5m for the UK’s first commercial geothermal power station, located near Redruth.
Iceland is the world leader in geothermal power, where deep holes are drilled to reach hot rocks, water is pumped down, heated and returned to the surface to generate electricity or provide heating.
Cornwall’s extensive granite means it has long been seen as the most promising part of the UK for the technology, which one study found could provide a fifth of the country’s power.
However, previous plans for geothermal plants in the county have faltered because of problems with financing and risk-averse investors.
The Eden Project, for example, has wanted to exploit the rocks beneath it since 2009, but failed to win European funding.
The £18m United Downs Deep Geothermal Power project near Redruth, by contrast, has already secured £13m in public funding, £10.6m from the European Regional Development Fund and £2.4m from Cornwall county council.
Ryan Law, managing director of Geothermal Engineering Ltd, the UK company behind the project, said: “The big problem is because nothing has been done in the UK before, it’s quite high risk. Finding funding for that risk is extremely difficult.”
Abundance is confident it will raise the final £5m needed, having raised £50m from individuals for renewable energy projects since it started five years ago, and £7m in the last two months alone.
Investors can expect a 12% return on the bond, which has an 18-month term, and will have their capital returned to them if the…