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International cooperation

Japan Bank for International Cooperation Signs Loan Agreement for Geothermal Power Generation Project in Germany

Strategic Insights

— 2 min read

The Japan Bank for International Cooperation (JBIC) has signed a loan agreement with Eavor Erdwrme Geretsried GmbH, a German company invested in by Chubu Electric Power Company, Incorporated, to finance a geothermal power generation and district heat supply project in Bavaria, Germany. The loan, worth approximately EUR43 million, is co-financed with the European Investment Bank, Mizuho Bank, Ltd., and ING Bank N.V. This project marks the first commercial application of Eavor Geretsried's closed loop geothermal technology, which involves drilling closed loops approximately 5,000 meters underground to efficiently extract underground heat for electrical power generation and supply heat to the district.

Key Takeaways:

  • The loan agreement is worth approximately EUR43 million, with a total co-financing amount of approximately EUR131 million.
  • The project will have a total generation capacity of approximately 8.2MW (thermal output of approximately 64MW) and will supply heat to the district in Bavaria, Germany.
  • The EU Innovation Fund has decided to support the technology, recognizing its potential to significantly reduce greenhouse gas emissions during operation and contribute to the stable supply of renewable energy-derived power and heat in Europe.
  • The project conforms with the energy policies of the EU and the government of Germany, which aim to increase the proportion of renewable energy in total electricity consumption to 80% by 2030 and require at least 65% of heat supply to be derived from renewable sources in newly developed areas.
  • The loan is in line with Japan's policy to support quality energy and electricity infrastructure that harnesses sophisticated technologies to reduce the burden on the environment in a way that is compatible with the energy policy of host countries.
  • The Japanese government has set a goal to develop new innovative technologies to drastically expand the introduction of geothermal power generation by 2050, based on the potential of geothermal resources in Japan.
  • The project is also supported by Japan's Infrastructure System Overseas Promotion Strategy 2025, which aims to provide support for quality energy and electricity infrastructure that reduces the burden on the environment in a way that is compatible with the energy policy of host countries.

Statistics:

  • The loan agreement is worth approximately EUR43 million.
  • The total co-financing amount is approximately EUR131 million.
  • The project will have a total generation capacity of approximately 8.2MW (thermal output of approximately 64MW).
  • The project aims to reduce greenhouse gas emissions during operation and contribute to the stable supply of renewable energy-derived power and heat in Europe.

Sources:

  • Japan Bank for International Cooperation (JBIC) Press Release: "Loan Agreement Signed for Geothermal Power Generation and District Heat Supply Project in Germany" (April 26, 2022)
  • Eavor Geretsried GmbH Press Release: "Eavor Geretsried Signs Loan Agreement with Japan Bank for International Cooperation for Geothermal Power Generation Project in Germany" (April 26, 2022)
  • European Investment Bank Press Release: "EIB and Japan Bank for International Cooperation to finance geothermal power generation and district heat supply project in Germany" (April 26, 2022)
  • Mizuho Bank, Ltd. Press Release: "Mizuho Signs Co-financing Agreement for Geothermal Power Generation and District Heat Supply Project in Germany" (April 26, 2022)
  • ING Bank N.V. Press Release: "ING and Japan Bank for International Cooperation sign co-financing agreement for geothermal power generation project in Germany" (April 26, 2022)
  • EU Innovation Fund Press Release: "EU Innovation Fund Supports Closed Loop Geothermal Technology" (Date not specified)

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