Partnership with Scottish and Southern Energy Plc provides Geothermal International with new platform to promote benefits of ground source energy
The announcement that Scottish and Southern Energy plc (SSE) will invest up to £15 million in cash for a 20% stake in Geothermal International Ltd from existing shareholders marks the start of a new era in the development and use of renewable energy from the ground in the UK.
The investment will be made on a phased basis over the next six months.
Geothermal International Ltd (GI) is the UK’s leading supplier of ground source heating and cooling systems. The company is well established with extensive operations throughout the UK, Ireland and to a lesser extent in Europe and has installed over 1300 ground source heat pump systems, amounting to over 90MW of installed capacity, sized from 6kW to 10MW since its formation in 2000.
The company has numerous clients in the public sector as well as more recently from the corporate sector including DHL, Unilever and B & Q.
Ground source energy can significantly reduce the gas and oil used to heat and cool buildings, and reduce the carbon emissions they produce. Its potential impact is underlined by recent figures indicating that almost half of the UK’s total carbon emissions are generated by buildings, with a large proportion of this figure caused by heating and cooling systems.
Ground source energy generation systems, such as those developed and pioneered by GI for the commercial sector, can reduce building heating and cooling running costs by up to 70% and reduce carbon emissions by up to 50%. In addition, as part of a mix of renewable technologies, they can significantly contribute to government targets to cut carbon emissions by 60% (by 2050), triple the supply of renewable energy by 2015, and make all new homes zero carbon by 2016 and non-domestic buildings zero carbon by 2019.
Announcing the partnership, GI said it was a vote of confidence in the business and the technology from one of the UK’s leading utility companies, and a new opportunity to create numerous commercial and strategic opportunities for its technology that can take the business to the next level.
Brian Davidson, CEO at Geothermal International said: “As the UK’s leading supplier of ground source heating and cooling systems for buildings, with extensive operations throughout the UK and Ireland and a growing presence in Europe, we are in a unique position to offer a complete service to the market as interest grows in this renewable energy source and more people become aware of its benefits.
“The partnership with SSE strengthens our position and also offers a great new opportunity to put this exciting technology on the map. It will enable us to grow, to develop more advanced and efficient ground source technologies, and by working alongside SSE to become the European market leader.”
Ian Marchant, Chief Executive of SSE said: “SSE is rapidly building a strong portfolio of clean energy businesses that cover almost every part of the renewable and alternative energy market in the UK. Geothermal energy has been an obvious missing piece in this portfolio and this deal fills the gap very effectively.
“Geothermal International is a well established business with a proven capability and will play a major role in supporting our growing Energy Services business. It provides SSE with access to renewable heat technologies that compliment the renewable electricity technologies we have already invested in, and reinforces our commitment to offer customers a complete range of renewable energy solutions.
“This is likely to become the largest direct investment made by our ventures team and represents the ninth deal since the team was created a year ago.”
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