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Frontiers of Engineering Management

ISSN 2095-7513

ISSN 2096-0255(Online)

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Front. Eng    2021, Vol. 8 Issue (3) : 390-401    https://doi.org/10.1007/s42524-020-0106-4
RESEARCH ARTICLE
Strategic analysis of China’s geothermal energy industry
Hao GONG1, Baicun WANG2(), Haijun LIANG3, Zuoxian LUO4, Yaofeng CAO5
1. SINOPEC Star Petroleum Co., Ltd., Beijing 100083, China; China National Research and Technology Center of Geothermal Energy, Beijing 100083, China; Chinese Academy of Engineering, Beijing 100088, China
2. Chinese Academy of Engineering, Beijing 100088, China; Department of Mechanical Engineering, University of Michigan, Ann Arbor, MI 48109, USA
3. SINOPEC Star Petroleum Co., Ltd., Beijing 100083, China; China National Research and Technology Center of Geothermal Energy, Beijing 100083, China
4. SINOPEC Economics and Development Research Institute, Beijing 100029, China
5. China National Research and Technology Center of Geothermal Energy, Beijing 100083, China; Chinese Academy of Engineering, Beijing 100088, China
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Abstract

China is an early user of geothermal energy, and its direct use ranks first in the world. Recent national strategies and policies have enabled China’s geothermal energy industry to enter a new era with important development opportunities. This paper investigates the strengths, weaknesses, opportunities, and threats (SWOT) to China’s geothermal energy industry from political, economic, social, and technological (PEST) perspectives. SWOT–PEST analysis indicates that the resources, market, and technological foundation exist for the large-scale development of China’s geothermal energy industry. However, it experiences constraints, such as unclear resource distributions, incomplete development of government regulations, incomplete implementation of national policies, unclear authority between governmental administrative systems, and lack of uniform technical standards and codes. Therefore, future development strategies have been proposed to provide technical support and policy tools for geothermal energy development. The recommendations to ensure its healthy and sustainable development include improving resource exploration, rationalizing administration systems, enhancing policy guidance and financial support, and cultivating geothermal talent.
Keywords geothermal energy      strategic analysis      SWOT–PEST      policy      administration     
Corresponding Author(s): Baicun WANG   
Just Accepted Date: 31 March 2020   Online First Date: 30 April 2020    Issue Date: 13 July 2021
 Cite this article:   
Hao GONG,Baicun WANG,Haijun LIANG, et al. Strategic analysis of China’s geothermal energy industry[J]. Front. Eng, 2021, 8(3): 390-401.
 URL:  
https://academic.hep.com.cn/fem/EN/10.1007/s42524-020-0106-4
https://academic.hep.com.cn/fem/EN/Y2021/V8/I3/390
Fig.1  Shallow geothermal heating (cooling) scale of different provinces and cities of China (at the end of 2015).
Fig.2  Hydrogeothermal heating scale of different provinces and cities of China (at the end of 2015).
Geothermal region Well No. Well depth (m) Bottom temperature (°C) Utilization status
Qiabuqia, Gonghe Basin DR3 2927 183 Heating for hospital
DR4 3102 181 Tentative power station
DR4 3102 181 Tentative power station
GR1 3703 236 Pumping test
GR2 3000 182 Sealing
Zhacanggou, Guide Basin ZR1 3051 151 Sealing and monitoring
ZR2 4300 175 Under construction
Qiongbei, Hainan Huadong No. 1 4387 185 Tentative research
Tab.1  China’s HDR exploration and development
Fig.3  Comparison of life cycle profit rate trend between geothermal and oilfield projects.
Fig.4  Comparison of China’s investment on key minerals and geothermal exploration during the 12th Five-Year Plan period.
Projects Initial investment (yuan per 100 m2) Heating costs (yuan per 100 m2 per heating season)
Enterprise Government Farmer First three years After three years
Government Farmer Farmer
Coal to electric 3300 7400 1305 2000 1056 3056
Coal to gas 7000 6700 1450 1200 1800 3000
Coal to geothermal energy 9600 7400 0 2000 1600 1600
Tab.2  Economic analysis of bulk coal substitution projects (surveyed in the rural area in Hebei)
Factors P E S T
Internal S Various policies and regulations introduced at the national and local levels Rich and stable resources; stable and sustainable income Relatively clean and safe Successful experience in geothermal heating
W Unclear resource amount High initial investment; lack of funds; poor financing channels Rough utilization; lack of talents Key technologies; information level; innovative ability
External O Ecological civilization construction; clean heating in Northern China; the Belt and Road Initiative Expanding energy market Characteristic agriculture; ecological agriculture Energy Internet; big data; information technology; intelligent manufacturing
T Rationalizing administration systems Inadequate industrial system Lack of social understanding Other renewable energy technologies
Tab.3  Factors affecting geothermal energy industry development
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