CROWDTHERMAL is a project funded under the European Union’s Research and Innovation programme Horizon 2020 (grant agreement no. 857830). The project aims to empower the European public to directly participate in the development of geothermal projects with the help of alternative financing schemes like crowdfunding and social engagement tools. The project is now in the last year of its EU-funded period.
In late 2021, GeoT submitted the project deliverable D4.5 Economic Analysis of the Application of the new Risk Mitigation Scheme to the European Commission. The report summarises the results of economic efficiency calculations that were performed to assess the economic implications of the proposed CROWDTHERMAL Risk Mitigation Framework for crowd-funded deep geothermal projects.
The economic assessment has demonstrated that the proposed Risk Mitigation Framework can entail more positive investment decisions and encourage more project continuations. For project developers, it can help more projects become economically feasible and can improve the bankability. It has a positive effect on the ability to repay loans and reduces the risk of insolvency and project stops. For community investors, it reduces the amount of capital at risk as well as the risk of credit default and losses, thus making geothermal a safer community investment.
Once implemented, the proposed support framework can be an effective way to tackle many of the financial challenges for geothermal developments and to contribute to an accelerated market development in Europe.