Daldrup & Söhne AG Endorses Government-Backed Insurance Initiative for Geothermal Exploration

Daldrup & Söhne AG, a leading drilling technology and geothermal specialist, has expressed its support for the newly announced initiative by the Federal Ministry of Economics and Technology (BMWK) and the KfW development bank. This initiative aims to introduce a government-supported insurance solution to mitigate the exploration risks associated with deep geothermal wells in Germany. The exploration risk covers potential failures to achieve expected temperatures or flow rates in drilled boreholes.

The move is part of a broader "geothermal campaign" initiated by the ministry at the end of 2022, enhancing the financial feasibility of deep geothermal projects through KfW loans. Andreas Tönies, CEO of Daldrup & Söhne AG, highlighted the importance of such insurance mechanisms in enabling municipal and private clients to undertake geothermal projects more confidently. He emphasized geothermal energy's role in decarbonizing heat supply and its advantages in providing a reliable, low-emission, and space-efficient base load energy source.

Daldrup & Söhne AG already has a history of offering innovative insurance solutions to its clients. Through partnerships in the insurance sector, it has developed an Alternative Risk Transfer (ART) concept, successfully applied in Germany and the Netherlands since 2016. This concept supports debt-based project financing, facilitating the realization of geothermal drilling projects. Tönies clarified that Daldrup does not act as a financier or insurer itself but collaborates with third-party insurers to cover exploration risks.