Economic Characteristics and Policies Study on Geothermal Space Heating Project of Typical Sandstone Reservoir in Northern China

Abstract

In June 2012, National Energy Administration authorized China Petrochemical Corporation to establish National Geothermal Energy Center of China, one of the main functions of which is to study and formulate geothermal development strategies, plans and policies. National Geothermal Energy Center of China has conducted a case study on geothermal space heating in northern China as the basis for formulating a national geothermal policy. This paper mainly analyzes one of the typical cases, a geothermal space heating project in Xianyang, Shaanxi province, summarizes the technical and economic characteristics of such projects from point to area, and makes a comparative study with other clean energy space heating, and puts forward countermeasures and suggestions to promote geothermal development. Typical projects are operated in BOO mode, featuring high investment and large space heating capacity. The depth of geothermal well is about 3,600 meters, the temperature of wells is around 108 0C. But the returns are modest, with after-tax payback periods of about 13 years. Under the pressure to control air pollution in northern China, local governments have given subsidies for clean energy space heating, about 168 yuan per square meter for coal to electricity and 87.98 yuan per square meter for coal to gas. The financial pressure is increasing. The operation cost of geothermal space heating is the lowest in clean energy space heating, which is very beneficial to residents' long-term stable space heating and suitable for clean space heating.