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Source: BUS Sachsen-Anhalt (Linie6PLus)

Apply for a loan with a repayment subsidy for the use of geothermal energy

Description

The Federal Ministry for Economic Affairs and Energy (BMWi) promotes measures to increase energy efficiency.
You can receive funding for the following measures:

  • for the construction of plants to use geothermal energy,
  • for production and injection wells to tap geothermal energy at a drilling depth of more than 400 metres for heat generation or for combined electricity and heat generation,
  • for additional costs for boreholes with special technical risks.

You will not receive any subsidies

  • for exploratory drilling,
  • for self-built and second-hand plants,
  • for prototypes (plants of which there are less than 4 units),
  • if you are the manufacturer of eligible equipment or its main components,
  • for trust constructions,
  • for so-called in-lieu transactions, such as purchases from a spouse's property,
  • for debt rescheduling and follow-up financing of measures that have already been started,
  • if you have already started with the measure before submitting the application.

The federal government, the states and their agencies are also not eligible.
If you tap deep geothermal energy and use it sustainably, you can get a loan of up to EUR 25 million. You can get a loan for up to 80 percent of the eligible costs of your measure.

The amount of the subsidy for the repayment of the loan depends on the type and use of your measure:

Measures exclusively for heat generation




  • Plant subsidies:
    • You receive EUR 200 per kilowatt (kW) of installed or expanded nominal heat output. You can receive a maximum of EUR 2 million in subsidies.

  • Drilling cost subsidy:
    • for drilling depths from 400 metres to 1,000 metres below, you receive EUR 375 subsidy for each metre of vertical depth (not drilling distance),
    • for the drilling depth between 1,000 meters and 2,500 meters below, you will receive EUR 500 subsidy for each meter of vertical depth (not drilling distance),
    • From a drilling depth of 2,500 metres, you receive EUR 750 subsidy for each metre of vertical depth (not drilling distance).

      You get a maximum of EUR 2.5 million subsidy for one deep well. You are allowed to drill up to 4 deep wells in total. You can therefore receive a maximum of EUR 10 million in subsidies.

  • Additional expenses for deep wells with particular technical risk:
    • For deep wells with a particular technical risk, you receive up to 50 percent of the additional costs incurred for each well (but no more than 50 percent of the previously planned costs).

      You can receive a grant of up to EUR 1.25 million for a well with a particular technical risk. In total, you can drill up to 4 deep boreholes in your project. You can therefore receive a maximum grant of EUR 5 million.

Measures for combined electricity and heat generation

  • Plant production:
    • The amount of your grant depends on the gross electrical output (P) and the nominal heat output (Q). The grant is calculated as follows: (1-(P/Q))*EUR 200 per kilowatt of installed or expanded nominal heat output. You can receive a maximum grant of EUR 1 million.

  • Drilling cost subsidy:
    • for the drilling depth from 400 meters to 1,000 meters you will receive EUR 375 subsidy for each meter of vertical depth (not drilling distance),
    • for the drilling depth between 1,000 meters to 2,500 meters below, you will receive EUR 500 subsidy for each meter of vertical depth (not drilling distance),
    • from a drilling depth of 2,500 meters you will not receive a subsidy.
    • You will receive a grant of up to EUR 975,000 for a deep well.

      In total, you may drill up to 4 deep wells in your project. You can receive a maximum of EUR 3.9 million in subsidies.
  • Additional expenses for deep wells with particular technical risk:
    • For deep wells with special technical risks, you receive up to 50 percent of the resulting additional costs for each well (but no more than 50 percent of the previously planned costs).

      You can receive a grant of up to EUR 1.25 million for a well with a particular technical risk. In total, you may drill up to 4 deep wells in your project. You can receive a maximum grant of EUR 5 million.

If you

  • one company
    • with fewer than 250 employees
      and
    • have an annual turnover of less than EUR 50 million
      and
  • the heat and/or energy produced by your measure is used for the operation of a small or medium-sized enterprise (SME),

then your grant will increase by 10 percent overall.

you will not receive the repayment grant until you have completed your measure. To do this, you must prove

  • that you have spent the money from the loan on the measure,
  • that the measure technically fulfils its purpose.

You must keep all invoices and receipts related to eligible costs.

Applications for the subsidy are processed by the Kreditanstalt für Wiederaufbau (KfW).

You are not entitled to the grant.

Note for small businesses:
Through the "Renewable Energy - Premium" promotional programme, small enterprises with fewer than 50 employees and annual sales of no more than EUR 10 million can also apply for a loan with a repayment subsidy (KfW promotional loan for renewable energy - deep geothermal energy (Premium) - No. 272/282 Approval for small enterprises (282)).

Applications may be submitted by:

  • large and medium-sized enterprises with
    • more than 49 employees
      and
    • a turnover of more than EUR 10 million per year
  • private individuals and freelancers who use the heat and/or electricity generated exclusively for their own private consumption
  • farmers
  • municipalities, municipal enterprises and special-purpose associations
  • Non-profit applicants and cooperatives

Further requirements:

  • Your measure must meet technical standards:
    • Your plant must tap and use geothermal energy from a drilling depth of more than 400 metres,
    • The thermal water or steam produced must be at least 20 degrees Celsius and have a geothermal heat output of at least 0.3 megawatts.
    • in the case of plants for combined electricity and heat generation: the nominal heat output must be at least 4,000 kilowatts
      and
    • the gross electrical capacity must be less than the heat connection capacity on the offtake side
  • the heat and/or electricity from your system must be used predominantly in Germany
  • You must operate your system for at least 7 years

Notice:
The usual formal requirements apply to loans to municipalities, municipal enterprises and special-purpose associations.

Application route A (bank transfer)
When submitting an application

  • Companies and legally independent municipal enterprises,
  • private individuals and freelancers,
  • farmers,
  • non-profit applicants and cooperatives and
  • contractors (energy service providers)

submit an application:

  • Application for repayment subsidy for deep geothermal energy.
  • in the case of "de minimis" funding:
    • "De minimis declaration
  • in the case of funding under the General Block Exemption Regulation (GBER):
    • Simplified self-declaration SME (if your company is independent and not intertwined with other companies)
      or
    • Self-declaration SME (if your company is not independent and is interlinked with other companies)
      or
    • Checklist for extra investment costs (if you are applying for environmental and energy aid)

If applicable, you must submit further documents for the technical documentation.

When you have completed your measure, you must submit the following documents:

  • Where-used list for companies and freelancers
  • Technical annex to the where-used list

Application procedure B (direct loan)
When submitting an application

  • municipalities,
  • legally dependent municipal enterprises and
  • special-purpose associations

submit

  • Application for repayment subsidy
  • Power of attorney and signature data sheet
  • Identification in accordance with the Money Laundering Act
  • Application for repayment subsidy
  • Power of attorney and signature data sheet
  • Identification in accordance with the Money Laundering Act

If applicable, you must submit further documents for the technical documentation.

When you have completed your measure, you must submit the following documents:

  • Where-used list for municipalities
  • Technical annex to the where-used list
  • Not applicable
  • Application: before the start of the measure
  • Call deadline for the loan: within 12 months of the loan commitment, in one sum or in instalments.
  • Evidence of use of funds: within 9 months after full disbursement of the loan.
  • for processing the application:
    • Application route A (bank transfer): usually 3 to 5 days
    • Application route B (direct loan): usually 4 weeks

Notice:
You can start implementing the measure immediately after you have been approved for your funding.

  • Forms: yes
  • Online procedure possible: no
  • Written form required: yes
  • Personal appearance required: yes (depends on the procedure at the financing partner)

Application procedure A (bank transfer)

  • Companies and legally independent municipal enterprises
  • Private individuals and freelancers
  • Farmers
  • Non-profit applicants and cooperatives
  • Contractors (energy service providers)

Reference:
You will receive all the necessary forms from your financing partner. The KfW application is submitted by your financing partner.

Application procedure B (direct loan)

  • Municipalities
  • Legally dependent municipal enterprises
  • Special-purpose associations

Application channel A (bank transfer)

  • Companies and legally independent municipal enterprises,
  • private individuals and freelancers,
  • farmers,
  • non-profit applicants and cooperatives and
  • contractors (energy service providers)

must apply for funding in writing to the Kreditanstalt für Wiederaufbau (KfW).

  • You first need a financing partner, through whom you then submit your application to KfW. A financing partner can be a bank, building society or financial intermediary.
  • Talk to your financing partner (for example, the bank with which you would like to conclude your financing) about including a promotional loan. They will advise you on which documents are required and will submit the application to KfW on your behalf.
  • Once KfW has approved your application for funding, you conclude a loan agreement with your financing partner.
  • As soon as the approval for your subsidy has been received, you can begin with the construction work or conclude the purchase contract.
  • Depending on the progress of construction, your financing partner will pay you the loan in one sum or in instalments.
  • When you have completed the measure, you must provide your financing partner with proof,
    • that you have spent the money from the loan on the planned measure and
    • that your measure meets the standard for KfW-efficient buildings.
  • Your financing partner checks and confirms your evidence and forwards it to KfW.
  • If KfW has also checked the evidence, you will receive the repayment subsidy as a credit to your loan account. This reduces the term of your loan.

Application procedure B (direct loan)

  • Municipalities,
  • legally dependent municipal enterprises and
  • special-purpose associations

must apply for funding in writing directly to the Kreditanstalt für Wiederaufbau (KfW).

  • Download the application form from the KfW website and complete it in full.
  • Then send it to KfW by post or fax together with the required documents.
  • KfW will review your application and decide on the funding. You will then receive notification by post from KfW as to whether your loan with repayment subsidy is approved.
  • Confirm the loan offer and start with the measure. KfW will pay you the loan amount in full.
  • When you have completed the measure, you must provide proof to KfW,
    • that you have spent the money from the loan on the measure and
    • that the measure technically fulfils its purpose.
  • You submit this evidence directly to KfW.
  • Once KfW has checked the evidence, you will receive the repayment grant as a credit. This reduces your loan term.

Federal Ministry for Economic Affairs and Energy (BMWi)

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