Owing in part to the increasing global realisation that sustainable and environmentally responsible power generation is one of the most critical issues facing modern civilization, research into power generation alternatives is also on the increase. Due to its inherently low conversion efficiency, the use of low-grade heat energy for electric power generation has been largely overlooked as a serious option. A new research programme has been created at the University of Canterbury which aims to show that low-grade heat (especially from geothermal sources) can be economically used for electric power generation. The premise of the research is based on the relative advantages offered through the implementation of appropriate low temperature differential Stirling engine-generator designs. The initial practical phase of the research is the design, construction and testing of small-scale prototypes that will operate with a temperature differential of as low as 30 K and output approximately 1 kW of electric power. Key considerations of the prototype designs are their scalability to larger power systems, and potential for commercial application. These considerations have led to the important inclusion of primarily common low-cost plastic and metal materials, and low engineering precision and technology mechanics.