Towards new business models for geothermal companies: state and trends

Abstract

The present paper will describe the current business models for geothermal District Heating (DH) and geothermal power (including cogeneration), their financial rationality and the trends towards new models adapted to new market design regulations. The process of business model design is part of convincing clients such as municipalities and operators in their business strategy. The work will include a presentation of the different business strategies used to approach the consumers and a description of their financial rationality.
The paper will assess, for each geothermal technology, the core aspects of creating value for a company (public, private, mix), and contributing to defining business strategies, including: upfront costs, running costs, core processes, infrastructure, organizational structures, selling options, and influencing regulations.
The business model development will be carried out on the basis of Osterwalder & Pigneur’s (2010) business model canvas. The objective of this business model canvas is to create an overview of micro-influencing factors which are necessary for a business model to succeed. It creates a common framework for understanding and working with business model across all European countries, which is necessary in order to develop new business models and to analyse and evaluate the generated business models.
On geothermal district heating, the focus will be on geothermal DH developers and operators. The costs will be analysed and compared with conventional DH and power systems costs and prices.
For geothermal power, the analysis will focus on both turbine manufacturers and project developers, and will describe the possibility to reduce time of project development.