REPLICATION OF GSHP BEST PRACTICE APPLICATIONS IN THE GREEK MARKET. SWOT ANALYSIS v.2

Transcription

1 REPLICATION OF GSHP BEST PRACTICE APPLICATIONS IN THE GREEK MARKET SWOT ANALYSIS v. BEST PRACTICE CASE STUDIES ANALYSED GROUNDHIT GSHP at the Polytechnic Institute of Setúbal GSHP at a two family house in Pikermi Open loop GSHP at hotel Amalia Direct expansion GSHP at a house in Ohlsdorf Prepared by A. Goumas and Ι. Haldezos Centre for Renewable Energy Sources and Saving January 0

2 Component 3 phase Assessment for BPs transferability & local adaptation Activity: 3.. Evaluation of the reproducibility of BP in each area GEO.POWER SWOT Analysis & Transferability Assessment. Introduction This report serves as an assessment of the reproducibility of best practices in the Greek market for advanced geothermal heat pumps (GSHP) systems and it is conducted through the identification of their strengths, weaknesses, opportunities and threats (SWOT). The assessment is based on the information collected and the studies produced in the framework of the Geo.Power project. In order to successfully complete the SWOT analysis a detailed examination and evaluation of the Greek market has been preceded, not only in regards of the advanced GSHP systems, but also considering competing technologies for heating and cooling of buildings. In specific, a market survey conducted on the existing heating and cooling systems as well as sanitary hot water summarized and illustrated the current market situation, considering available types of heating and cooling systems, distribution alternatives, installations and sales shares in national level. In the meantime, a number of basic configurations were examined under a variety of different combinations of parameters in regards with location, application and type of ground heat exchanger, heat rejection technology etc. Those, which showed up the highest energetic and cost efficiency for a broader range of applications, served as a model for the definition of the best available practices for promotion and dissemination activities. Taking into account the results of all the above, a SWOT Analysis is carried out distinguishing the arisen conclusions into Strengths, Weaknesses, Opportunities and Threats.. SWOT Analysis The SWOT Analysis is a very common process in strategic planning, providing a framework to categorize a wide range of inputs from technical, financial and other experts in a way that facilitates decision making. SWOT is an acronym for Strengths, Weaknesses, Opportunities and Threats. The SWOT analysis headings provide a good outline for reviewing and assessing the strategy, position and direction of a company or business proposition, or any other idea. A SWOT analysis is an assessment of data which is organized by the SWOT format into a logical order that helps understanding, presentation, discussion and decision-making. The four dimensions are a useful extension of a basic two heading list of pro's and con's. Moreover, a scan of the internal and external environment is an important part of the strategic planning process. Environmental factors (external) to the investigated system are classified as opportunities (O) or threats (T), while the factors concerning the system and its value chain qualities (internal) are classified as strengths (S) or weaknesses (W). Centre for Renewable Energy Sources and Saving

3 Figure : Schematic representation of the SWOT Analysis. Based on the aforementioned principles, a comprehensive SWOT analysis for the Geothermal Systems using earth-coupled and groundwater (or seawater) heat pumps referred also as Ground Source Heat Pumps (GSHP) or Geothermal Heat Pumps (GHP) is carried out in the following paragraphs. This analysis aims at recognizing the advantages and the drawbacks of the technology, which are categorized as strengths to be enhanced and weaknesses to overcome respectively. Moreover, external factors related to the current market situation and the prospects for future developments are investigated aiming at identifying the opportunities to be exploited and the threats that have to be avoided for a successful market penetration of geothermal energy. The investigation of both strengths and weaknesses is conducted on a technical, cost-related and marketing basis, whereas the exploration of external factors, i.e. opportunities and threats, is carried out through consideration of technical, cost-related and market related issues, as well as financial incentives and legislation. PART I: EXTERNAL ANALYSIS Opportunities Threats Market segment Environment Vulnerability to competition Market segment Environment Vulnerability to competition PART II: INTERNAL ANALYSIS Strengths Weaknesses Technical issues Cost-related parameters Marketing Technical issues Cost-related parameters Marketing 3. PART I: EXTERNAL ANALYSIS (OT) Based on the basic principles of a SWOT analysis first of all, the external analysis (the nd part of the SWOT analysis) should be completed concerning the Greek territory, where 4 selected Geo.Power best practices (BPs) will be promoted for replication according to the local action plan that will be prepared. Centre for Renewable Energy Sources and Saving 3

4 The external analysis is the evaluation of the local market and environment. Following the list of components reported below, in the left column of the table, the Opportunities (O) and Threats (T) for the Geek territory are evaluated attributing a score on the basis of certain criteria. Name of region/area: Greece External analysis Opportunities (O) Threats (T) Score (SC) Market segment Market segment size (geothermal energy for heating and cooling) Growth rate Interest from customers Degree of acceptance Price sensitivity Attracting cooperation Job creation potential Government subsidies and incentives Growing economy Taxation Investor interest Environment Environmental impact (of geothermal energy for heating and cooling) Suitability of boundary conditions (climate, geology,...) Government regulations Political support Public opinion and public awareness Actor involvement (stakeholders, public administrations, Multiutility companies, etc.) Capacity for & promotion of innovations/new technologies (esp. smart techs, whole-system self optimisation) Vulnerability to competition Competing energy sources - price & availability Competing plant technologies - price & availability Selling power Financial resources Distribution network and infrastructure Applicability of technology and use (public building, industry & SMEs sector, and/or agriculture) Visibility of the BP and promotional activity Centre for Renewable Energy Sources and Saving 4

5 Score Criteria Very high transferability Good transferability, above average 0 Not applicable. - Poor transferability: causes some problems. - Very poor transferability: needs a lot of attention. According to the a.m. list, a detailed analysis of each component relating to technical, cost-related and market issues is conducted assessing the transferability of selected BPs in the Greek market and then followed by a brief description in tables completed for each BP proposed. 3. Market segment Existing GSHP features make them only suitable for their operation with low temperature heating systems, which limits their application mainly to new or smaller buildings, as they are not designed to meet the high supply temperature demands of older or bigger heating/cooling systems already installed in many existing buildings all over Greece. At present, geothermal energy and GSHP market in Greece is regarded small taking into account the decreasing sales of GSHP systems and the suspension of buildings construction activities due to country s economic recession which introduce a further threat for the GSHP market. In general, it can be concluded, that market penetration of GSHP is still modest throughout Greece as the most pathogenic elements of economy introduces high risks but also high investments opportunities at the same time. Market segment size The GSHPs market in Greece is small, especially the segment for commercial (hotels) and public (schools) applications. Growth rate Due to so far small penetration of geothermal energy and GSHP use in the energy market, the predictions for a further development of the market are promising. Based on the innovative technologies used in our case studies and considering the particularity of each system implemented in any case the market growth rate varies accordingly from very high transferability (University of Setubal and -family house in Pikermi) to good transferability (above average for Hotel Amalia and not applicable (for -family house in Ohlsdorf). Interest from customers The last years, the green energy is transmitted more and more through mass media and more people are made familiar with the new technologies and systems concerning energy saving and environmental protection. Nevertheless, the novelty of new systems and the degree of adaptability results in a more increasing interest in SME sector in relation with the private sector. Therefore, the interest for the new systems creates the necessity for an extensive investigation on behalf of SMEs resulting in a very high transferability. On the other hand, a significant transferability above average is recently noticed amongst end-users. Decree of acceptance GSHPs are an established technology well accepted among Greek end users due to the sustainability, noiseless, reliability and environmental friendliness of the technology. Price sensitivity Centre for Renewable Energy Sources and Saving 5

6 Due to the continuous changing of legal framework and not stabilized economic environment this criterion renders high degree of uncertainty for investments and customers. In a new market like Greek, some expenditure such as the purchase cost of new systems, the installation and O & M costs, with lack of regulations or other market rules put the interested third parties in doubt or in suspense. On this basis, the Greek market is not regarded secure and appears all those characteristics of a new developing market. For this reason a lot of attention is paid to the price by consumers and end users especially due to deteriorating incomes and profits. Attracting cooperation The utilization of the ubiquitous shallow geothermal resources by decentralized GSHP systems is an obvious option. But the combination with other innovative technologies such as PV systems for power generation that may lead in zero emission buildings with coverage of the total electric and heating/cooling and SHW load is also a promising option. Moreover, the exploitation of geothermal resources and the effective use of GSHP require the involvement and active participation of more market stakeholders. The cooperation and synergies capability with drilling companies, HVAC engineers, architects, research centres, scientific organizations and professionals, gives a good transfer opportunity to geothermal energy through GSHP systems application in buildings. Job creation potential A currently important opportunity for the market penetration of GSHP systems is the recent increase of labour pool due to the economic recession. The availability of labour pool will enhance/strengthen the development of manufacturing companies in all the relevant fields of the production procedure, from system engineering design, marketing and installation. The further development of GSHP market will be accompanied by a significant opening of new jobs as well as the establishment of new business and retailing companies. As there have been some installations of GSHP systems, this already shows an emerging interest from different markets on new technologies, especially those of using renewable energies and it could be an essential opportunity for the reinforcement of the job market. Job creation potential is more profound in the case of domestic applications, e.g. -family house in Pikermi and -family house in Ohlsdorf due to the potential size of the market segment. Government subsidies and incentives In the general energy policy of the European Union, sustainability holds an important role in the priorities set for the achievement of its environmental goals. Adherent to EU strategy, Greek state intention is to proceed in a constant promotion of sustainability through incentives, communications, guidelines and various projects on RES exploitation and building s energy saving. Through this change of market direction, the use of geothermal energy and GSHP technology can significantly profit highlighting its environmental profile. Based on the need to open new emerging markets, a major opportunity for small-scaled GSHP systems applies to the enactment of a legislative framework incorporating new feed-in tariffs by technology on energy efficiency and renewable energy sources (including shallow geothermal energy), as well as some additional improvements in the regulations under the consultation on simplifying application procedures in certain fields (particularly buildings) of the private and public sector. Due to enforcement at present of the aforementioned energy policy and due to expectations for ambitious support measures to be enacted in the near future, various market stakeholders may be motivated, who are pioneers and front runners in general in areas such as green technology and climate protection to promote GSHP technology with faster steps. Under these conditions and the existing legal framework, the institutes have been credited with more advantages in promoting green technology and thus with higher transferability as a result of further expertise in new technologies. Growing economy Centre for Renewable Energy Sources and Saving 6

7 The economic recession in Greece during the last few years and adverse predictions for the future, are a limiting factor for the development of the energy market and investment attraction. The liquidity in the market is low and the credit services of the banking sector in suspension. The result is most of SMEs face many problems to remain competitive or even survive in this unstable environment. Such high-risk environment introduces many threats to the market stakeholders and requires a lot of attention to cancel the very poor transferability. Taxation In parallel to the negative development rates of Greek economy, the tax imposition in Greece follows an increasing trend. Taxation in Greece varies from 0% 40% depending on the firm size and scale of taxation and other factors (distribution of profits among shareholders etc.). For private individual end-users the charge is higher than SMEs imposing a further obstacle in implementation of GSHP systems in housing sector. In research and educational public institutes however, purchasing decisions are not affected by high taxation rates, as emphasis is placed on technological and innovation aspects. In the commercial sector (e.g. Hotel Amalia), GSHP price increase due to high tax rates is offset by tax reductions due to reduced profit margins from increased expenses. Investor interest Due to rising oil prices and domestic taxation on oil, interest of investors is high and growing, as GSHPs are a new promising technology for both companies and householders. It is realistic that amongst other RES technologies, the shallow geothermal energy and the use of GSHP systems can result in drastic reduction (up to 60%) of the buildings energy consumption for heating and cooling. In spite of economic recession this field seems to give hope and development perspective to stakeholders (entities, customers, engineers, architects, professionals etc.). In the Tables below (end of chapter 3) a summary of the results of the above analysis for all case studies is given together with the presentation of the weighting factors and the scoring criteria. 3. Environment Environmental impact The impact from the application of GSHP systems on the environment is very positive, as it results in considerable primary energy savings and corresponding avoidance of carbon dioxide emissions. Furthermore, GSHPs have a positive impact to local environment due to no visible components at the building envelop, zero local emissions of waste gases and noiseless operation compared to oil boilers. Suitability of boundary conditions The Greek Mediterranean climate is subjected to mild, wet winters and hot, dry summers. Temperatures rarely reach extremes. In particular, this mild climate is encountered in coastal areas, where the bulk of the population resides. In addition, a continental climate is met primarily in interior parts of the country (Thessalia, central Peloponnesus). A mid-european temperate climate is met in Central and Eastern Macedonia as well as in Thrace, with cold, damp winters and hot, dry summers. These mild climatic conditions are extremely favourable to geothermal heat pumps, due to balanced ground thermal loads and increased COPs. The suitability of boundary conditions is strictly associated with the particular ground and rock properties of the area where the systems will be applied. GSHP systems are generally favoured by wet, moisture soil conditions and the presence of subsurface aquifers, conditions widespread in country s sedimentary basins and especially at areas in the vicinity of the sea. Hotels are particularly benefit from local hydrogeologic conditions, as they are usually located near the sea, as well as from climatic conditions, as they mainly need cooling and hot water during the summer, which can be provided by GSHPs with the maximum possible energy efficiency. Schools are Centre for Renewable Energy Sources and Saving 7

8 also in a favourable position in terms of climate and geology, as they are located in urban areas, as well as from their cooling needs during late spring and early summer, which can be covered by free cooling directly from the ground heat exchanger. Government regulations A major opportunity for geothermal energy systems applies to the enactment of a legislative framework concerning energy efficiency as well as the employment of RES in certain fields (particularly buildings) of the private and public sector. The legislation enacted in Greece supports GSHP market development and is expected in the near future to simplify further the licensing procedure for the application of GSHP systems in buildings. Thus the final regulatory framework in Greece regarding the use of geothermal energy is expected to be very promising waiting for the good transferability, above the average in the near future. Political support The initiative of Kyoto protocol and all the future actions of European and World leaders have committed the worldwide community in direction of enacting regulations and establishing measures and policies for favourable development of RES and energy saving. In lining with the European policy, one of the Greek state s first priorities over the last years is the support on RES and energy saving in Greece. This increasing interest in RES provides a great opportunity of political support for the promotion of GSHP technology. Public opinion and public awareness In Greece, GSHPs are perceived as a positive technology reducing annual energy bills and contributing effectively towards protecting the environment, with good awareness among the public. Actor involvement Concerning the GSHP market of Greece, a good deal of stakeholders are involved, including geologists, architects, engineers, importers, equipment suppliers, politicians, works contractors, educational and training institutes, research centres, building owners and others. More effort in this direction can further improve the opportunity for transferability of best practice case studies. Capacity for & promotion of innovations/new technologies Geothermal heat pumps are a new and evolving technology for exploitation of shallow geothermal resources to cover heating, cooling and hot water demands in buildings. As a new technology there is lot of room for further improvements in terms of engineering practices, construction, control and marketing. Promotion of innovations can be done through research institutes, universities, schools and dedicated programs in the mass media. The transfer capacity through the proposed case studies is very high and more profound for those cases which integrate systems which cover a high rate of combined energy demands such as the University of Setubal, the house in Pikermi and the hotel Amalia, in comparison to the house of Ohlsdorf covering just heating demands. 3.3 Vulnerability to competition Competing energy sources In recent years the most significant obstacles in GSHP penetration in the energy market is intense competition from market leading technologies and alternative energy sources the most important of which are air source split air conditioning units and natural gas. Both (air-source and natural gas) are characterized by low pricing and extensive distribution channels covering entire market. This strong competition is further enhanced by: Prices deformation of the existing subsidies and unequal taxation without taking into account the external costs imposed by the environmental criteria. GSHPs still have high installation and maintenance costs and large import taxes on equipment resulting in not being competitive to fossil fuel technologies and other alternative energy sources. Credit unwillingness for investments in technologies that are not yet familiar to the public. Centre for Renewable Energy Sources and Saving 8

9 The overall economic energy policy that is still remaining favourable to fossil fuel energy sources in general and natural gas in particular. Fossil fuel subsidies which make GSHPs relatively more expensive and less competitive Due to these obstacles, more effort in transferability is needed mostly in the cases of public buildings with high energy demands. Competing plant technologies Main competitor of GSHPs are split air conditioning units which are widespread, extensively promoted, continually improving technology, low price units and small capacity allowing staged market penetration. For this reason, each heating or cooling system using geothermal heat pumps and thus the suggested case studies present a natural vulnerability to competition and require a lot of attention to reverse this drawback against the fossil fuels and natural gas plants. Selling power In contrast to GSHP installers, who are SMEs with limited selling power, the large companies supplying air-source heat pumps and utilities in the gas sector holding a big share of the energy market are able to control the market prices according to their strong selling power. Financial resources Competitors to GHSPs in Greece, have access to abundant financial resources, due to their size, profitability, economic status and multi national coverage. Distribution network and infrastructure Split air conditioning unit suppliers and dealers have excellent distribution networks and infrastructure reaching even the most remote customer. Natural gas utilities have also good gas distribution piping network, covering the mail mainland cities. Applicability of technology and use (public building, industry & SMEs sector, and/or agriculture) Competing technologies cover the entire market, leaving no market segments free for GSHPs. The threat is coming from the already mature technologies (natural gas, air source spit units, diesel boilers) and other promising renewable energy technologies (e.g. biomass and solar thermal technology) and concerns more the private building sector (house or tourist buildings) rather than public buildings (e.g. University of Setubal) where sometimes the decision making is taken not only on cost basis. Visibility of the best practice and promotional activity Long term intense promotional activity of competing technologies through all types of communication and marketing channels and events have increased their visibility among energy users and the public, while keeping the visibility of GSHPs to very low level. Centre for Renewable Energy Sources and Saving 9

10 ) Name of region/area: GREEK MARKET : Polytechnic of Setùbal in the Greek market External analysis Opportunities (O) Threats (T) Score Market segment Market segment size (geothermal energy for heating & cooling) Growth rate GHSPs systems can sometimes access better in schools and universities as the selection is not always based on cost criteria. High possibility. Closed loop systems easy to apply in most areas with no serious restrictions. Large municipal building capacity (schools, universities etc.) GSHPs market in Greece is small, especially the segment for commercial (hotels) and public (schools) applications. Interest from customers Increasing interest in customers (end-users) of public buildings Degree of acceptance GSHPs are well-accepted among Greek end users due to the sustainability, noiseless, reliability and environmental friendliness of this technology. Price sensitivity Very high due to high turn-key and O & M costs and the lack of regulations or other market rules and incentives (e.g. no subsidies) Attracting cooperation PV sector, solar thermal sector, drilling companies, HVAC, engineers, architects, R & D centers The high drilling costs, the lack of regulations compared to other technologies. Job creation potential Very high (see analysis above) Smaller potential size of the market segment compared to domestic sector. Government subsidies and incentives New feed-in tariff policy (law no. 385/00), regulations and structural measures under consultations, motivate stakeholders to promote GSHP technology with faster steps and institutes to get higher expertise and more advantages in promoting green technology resulting in higher transferability. Growing economy Economic recession, low liquidity and loans in suspension in the last years constitute a limiting factor in investing attraction. Taxation Investor interest Environment Environmental impact Tax imposition in Greece follows an increasing trend for any organization or firm. Taxation in Greece varies from 0% 40% depending on the firm size and scale of taxation and other factors. Due to rising oil prices and domestic taxation on oil, interest of investors is high and growing, as GSHPs are a new promising technology for both companies and householders. Very positive impact to local and entire environment Primary energy savings Reduction of CO emissions. No visible components of GSHPs at the building envelope In research and educational public institutes however, purchasing decisions are not affected by high taxation rates, as emphasis is placed on technological and innovation aspects. Economic recession

11 Zero local emissions of waste gases in local environment Noiseless operation compared to oil burners. Suitability of boundary conditions (climate, geology,...) Very high. Schools are in a favourable position in terms of climate and geology, They are located in urban areas Their cooling needs in late spring and early summer can be covered by free cooling directly from GHE. Government regulations Good transferability. The final regulatory framework in Greece regarding the use of geothermal energy is expected to be very promising. The process of legislation enacting is hindered by the bureaucracy and partly by the current economic situation. Economic policy has been focused in austerity measures imposed by EU against the economic recession. Political support The increasing interest in RES, arising from the state s commitments, provides a great opportunity of political support for the promotion of GSHP technology. Public opinion and public awareness GSHPs with good awareness among the public, are perceived as a positive technology because Reduce the annual energy bills Contribute effectively to the environment protection Certain public groups might not comprehend the difference among the meanings shallow and deep geothermal energy for electricity and still remain in ambiguity regarding the benefits of the shallow geothermal energy to cover heating, cooling and DHW demands. Actor involvement (stakeholders, public administrations, Multi-utility companies, etc.) Good deal of stakeholders are involved (including geologists, architects, engineers, importers, equipment suppliers, works contractors, educational and training institutes, research centres, building owners and others). The involvement of experienced companies as market leaders and the customer attraction are not yet in effective level. Capacity for & promotion of innovations/new technologies (esp. smart techs, wholesystem self-optimisation) The transfer capacity through this proposed case study is very high and more profound because this addresses a system which covers a high rate of combined energy such as heating, cooling and DHW demands. Promotion of innovations can be done better through research institutes, universities, schools & dedicated programs in the mass media. Vulnerability to competition Competing energy sources - price & availability Poor transferability due to the following reasons: Intense competition from market leading technologies and alternative energy sources prices deformation of the existing subsidies and unequal taxation High installation and maintenance costs and large import taxes on equipment. Credit unwillingness for investments in technologies that are not yet familiar to the public. The overall economic energy policy that is still remaining favourable to - Centre for Renewable Energy Sources and Saving

12 Competing plant technologies - price & availability fossil fuel energy sources and natural gas. Fossil fuel subsidies which make GSHPs relatively more expensive and less competitive. (see more in text analysis) Main competitor of GSHPs are the fossil fuels and natural gas plants and particularly the split air conditioning units (see par. 3.3) GSHPs and thus the suggested case studies present a natural vulnerability to competition and require a lot of attention to reverse this drawback against the competitive technologies. Selling power The market prices are controlled according to the selling power of the more mature and strong technology. Selling power of GSHP is limited compared to air-source heat pumps and utilities in the gas sector holding a big share of the energy market. Financial resources Competitors to GHSPs in Greece, have easier access to abundant financial resources, due to their size, profitability, economic status and multi-national coverage. Distribution network and infrastructure Applicability of technology and use (public building, industry & SMEs sector, and/or agriculture) Visibility of the BP and promotional activity The competing to GHSPs technologies concerns more the private building sector (house or tourist buildings) rather than public buildings (e.g. Polytechnic of Setubal) where sometimes the decision making is taken not only on cost basis. The visibility of new innovative systems such as GSHPs is better supported when installing in public buildings (universities, schools etc.) Split air conditioning unit suppliers and dealers have excellent distribution networks and infrastructure reaching even the most remote customer. Natural gas utilities have also good gas distribution piping network, covering the mainland cities. Competing technologies cover the entire market, leaving no market segments free for GSHPs. The threat is coming from the already mature technologies (natural gas, air source spit units, diesel boilers) and other promising renewable energy technologies (e.g. biomass and solar thermal technology). Long term intense promotional activity of competing technologies through all types of communication and marketing channels and events have increased their visibility among energy users and the public, while keeping the visibility of GSHPs to very low level Centre for Renewable Energy Sources and Saving

13 ) Name of region/area: GREEK MARKET : Pikermi -family house in the Greek market External analysis Opportunities (O) Threats (T) Score Market segment Market segment size (geothermal energy for heating and cooling) Growth rate Interest from customers Degree of acceptance Domestic heating & cooling systems promise a better future provided that GSHP systems are going to receive corresponding support from the state as the rest RES technologies. High possibility. The provisions for a further development of the market are promising due to political support in promotion of energy saving in buildings. The GSHP systems can successfully contribute this perspective particularly in the new buildings of zero energy consumption. The proposed BP refers to a new house of reduced energy demands in which a GSHPs system is applied to cover in total the remaining heating and cooling loads. The novelty of new systems and the promotion through mass media have made more and more people familiar with the new technologies increasing the degree of adaptability between end-users. A significant transferability above average is recently noticed amongst private end-users. GSHPs are well-accepted among Greek end users due to sustainability, noiseless, reliability and environmental friendliness of this technology. The GSHPs market in Greece is still small. 0 The interest of private end-users for GSHPs systems is less obvious in relation to the public end-users. Price sensitivity Very high due to high turn-key and O & M costs and the lack of regulations or other market rules and incentives (e.g. no subsidies) Attracting cooperation Job creation potential Government subsidies and incentives PV sector, solar thermal sector, drilling companies, HVAC, engineers, architectsthe high drilling costs, the lack of regulations compared to other R & D centers technologies. Due to economic recession, it is recently noticed many companies and professionals switching to green energy amongst the geothermal energy. Further development of GSHP market will result to establishment of new business and retailing companies and thus to significant opening of new jobs. New feed-in tariff policy (law no. 385/00), regulations and structural measures under consultations, motivate stakeholders to promote GSHP technology with faster steps. The process of legislation enacting is hindered by the bureaucracy and partly by the current economic situation. Economic policy has been focused in austerity measures imposed by EU against the economic recession. Growing economy Economic recession, low liquidity and loans in suspension in the last years constitute a limiting factor in investing attraction. Taxation Tax imposition in Greece follows an increasing trend for any organization - - -

14 Investor interest Environment Environmental impact Suitability of boundary conditions (climate, geology,...) Government regulations Political support Due to rising oil prices and domestic taxation on oil, interest of investors is high and growing, as GSHPs are a new promising technology for both companies and householders. Very positive impact to local and entire environment Primary energy savings Reduction of CO emissions. No visible components of GSHPs at the building envelope Zero local emissions of waste gases in local environment Noiseless operation compared to oil burners. Very high. The location of the -family house in Pikermi is very suitable due to: good ground and rock properties (wet and moisture soil conditions). favourable hydrogeologic conditions and the presence of subsurface aquifer that favour the use of an open loop system. Good transferability. The final regulatory framework in Greece regarding the use of geothermal energy is expected to be very promising. The increasing interest in RES, arising from the state s commitments, provides a great opportunity of political support for the promotion of GSHP technology. or firm. Taxation in Greece varies from 0% 40% depending on the firm size and scale of taxation and other factors. Inhibitor factor: Economic recession The process of legislation enacting is hindered by the bureaucracy and partly by the current economic situation. Economic policy has been focused in austerity measures imposed by EU against the economic recession. Public opinion and public awareness Actor involvement (stakeholders, public administrations, Multi-utility companies, etc.) Capacity for & promotion of innovations/new technologies (esp. smart techs, whole- GSHPs with good awareness among the public, are perceived as a positive technology because Reduce the annual energy bills Contribute effectively to the environment protection Good deal of stakeholders are involved (including geologists, architects, engineers, importers, equipment suppliers, works contractors, educational and training institutes, research centres, building owners and others). The transfer capacity through this proposed case study is very high and more profound because this addresses a system which covers a high rate of combined heating & cooling demands in combination with energy saving measures (good Certain public groups might not comprehend the difference among the meanings shallow and deep geothermal energy for electricity and still remain in ambiguity regarding the benefits of the shallow geothermal energy to cover heating, cooling and DHW demands. The involvement of the pioneer companies as market leaders and the customer attraction are not yet effective. The communication of involved parties needs improvement. Centre for Renewable Energy Sources and Saving 4

15 system self-optimisation) Vulnerability to competition Competing energy sources - price & availability Competing plant technologies - price & availability wall insulation, windows with double glass etc.). More intensive competition from fossil fuels technologies is noticed in public buildings as a result of high energy saving capacity. Poor transferability due to the following reasons: Intense competition from market leading technologies and alternative energy sources prices deformation of the existing subsidies and unequal taxation High installation and maintenance costs and large import taxes on equipment. Credit unwillingness for investments in technologies that are not yet familiar to the public. The overall economic energy policy that is still remaining favourable to fossil fuel energy sources and natural gas. Fossil fuel subsidies which make GSHPs relatively more expensive and less competitive. (see more in text analysis) Main competitor of GSHPs are the fossil fuels and natural gas plants and particularly the split air conditioning units. GSHPs and thus the suggested case studies present a natural vulnerability to competition and require a lot of attention to reverse this drawback against the competitive technologies. (see more in par. 3.3) Selling power The market prices are controlled according to the selling power of the more mature and strong technology. Selling power of GSHP is limited compared to air-source heat pumps and utilities in the gas sector holding a big share of the energy market. Financial resources Competitors to GHSPs in Greece, have easier access to abundant financial resources, due to their size, profitability, economic status and multi-national coverage. Distribution network and infrastructure Applicability of technology and use (public building, industry & SMEs sector, and/or agriculture) Split air conditioning unit suppliers and dealers have excellent distribution networks and infrastructure reaching even the most remote customer. Natural gas utilities have also good gas distribution piping network, covering the mainland cities. Competing technologies cover the entire market, leaving no market segments free for GSHPs. The threat is coming from the already mature technologies (natural gas, air source spit units, diesel boilers) & other promising RES technologies (e.g. biomass and solar thermal technology) Centre for Renewable Energy Sources and Saving 5

16 Visibility of the BP and promotional activity The visibility of proposed BP which integrates a modern GSHP system in a new constructed house combining further energy saving techniques assist the promotion activities of GSHPs and geothermal energy. Long term intense promotional activity of competing technologies through all types of communication and marketing channels and events have increased their visibility among energy users and the public, while keeping the visibility of GSHPs to very low level. - Centre for Renewable Energy Sources and Saving 6

17 3) Name of region/area: GREEK MARKET : Hotel Amalia in the Greek market External analysis Opportunities (O) Threats (T) Score Market segment Market segment size (geothermal energy for heating and cooling) Growth rate Interest from customers Degree of acceptance Domestic heating cooling and SHW promise a better future provided that GSHPs systems will receive corresponding support from the state as the rest RES technologies. Good transferability. The provisions for a further development of the market are promising due to political support in promotion of RES and energy saving in buildings. The novelty of new systems and the promotion through mass media have made more and more people familiar with the new technologies increasing the degree of adaptability between end-users. Significant transferability above average is recently noticed amongst the users of tourist services (customers & employees). GSHPs are well - accepted among Greek end-users due to sustainability, noiseless, reliability and environmental friendliness of this technology. The GSHPs market in Greece is small, especially the segment for commercial (hotels) and public (schools) applications. The tourist sector is not so large. There are not specific support programs in running for tourist lodgings. Sometimes the use of geothermal energy in tourist sector is not as much evident to the customers as other renewable energy technologies (e.g. solar thermal). - Price sensitivity Very high due to high turn-key and O & M costs and the lack of regulations or other market rules and incentives (e.g. no subsidies) Attracting cooperation Job creation potential Government subsidies and incentives PV sector, solar thermal sector, drilling companies, HVAC, engineers, architects, R & D centers Due to economic recession, it is recently noticed many companies and professionals switching to green energy amongst the geothermal energy. The further development of GSHP market will result to establishment of new business and retailing companies and thus to significant opening of new jobs. New feed-in tariff policy (law no. 385/00), regulations and structural measures under consultations, motivate stakeholders to promote GSHP technology with faster steps. The high drilling costs, the lack of regulations compared to other technologies. The market size of tourist segment is not too large in Greece to absorb all this labour capacity. The process of legislation enacting is hindered by the bureaucracy and partly by the current economic situation. Economic policy has been focused in austerity measures imposed by EU against the economic recession. Growing economy Economic recession, low liquidity and loans in suspension in the last years constitute a limiting factor in investing attraction. - - Taxation In the commercial sector (e.g. Hotel Amalia), GSHP price increase due to high tax rates is offset by tax reductions due to reduced profit margins from increased expenses. Tax imposition in Greece follows an increasing trend for any organization or firm. Taxation in Greece varies from 0% 40% depending on the firm size and scale of taxation and other factors. 0 Centre for Renewable Energy Sources and Saving 7

18 Investor interest Environment Environmental impact Suitability of boundary conditions (climate, geology,...) Government regulations Political support Due to rising oil prices and domestic taxation on oil, interest of investors is high and growing, as GSHPs are a new promising technology for both companies and householders. Very positive impact to local and entire environment Primary energy savings Reduction of CO emissions. No visible components of GSHPs at the building envelope Zero local emissions of waste gases in local environment Noiseless operation compared to oil burners. Very high. The location of the -family house in Pikermi is very suitable due to: good ground and rock properties (wet and moisture soil conditions). favourable hydrogeologic conditions and the presence of subsurface aquifer that favour the use of an open loop system. Good transferability. The final regulatory framework in Greece regarding the use of geothermal energy is expected to be very promising. The increasing interest in RES, arising from the state s commitments, provides a great opportunity of political support for the promotion of GSHP technology. Inhibitor factor: Economic recession The rate of legislation enactment is inhibited by the bureaucracy and partly the current economic situation. Priorities have been set in enactments to solve other problems (financial etc.) Public opinion and public awareness Actor involvement (stakeholders, public administrations, Multiutility companies, etc.) Capacity for & promotion of innovations/new technologies (esp. smart techs, whole-system self-optimisation) GSHPs with good awareness among the public, are perceived as a positive technology because Reduce the annual energy bills Contribute effectively to the environment protection Good deal of stakeholders are involved (including geologists, architects, engineers, importers, equipment suppliers, works contractors, educational and training institutes, research centres, building owners and others). The transfer capacity through this proposed case study is very high and more profound because this addresses a system which covers a high rate of combined heating and cooling demands in combination with energy saving measures (good wall insulation windows with double glass etc.). Certain public groups might not exactly comprehend the difference among the terms shallow and deep geothermal energy for electricity and still remain in ambiguity regarding the benefits of the shallow geothermal energy to cover heating, cooling and DHW demands. The involvement of the pioneer companies as market leaders and the customer attraction are not yet effective. The communication of involved parties needs improvement. Centre for Renewable Energy Sources and Saving 8

19 Vulnerability to competition Competing energy sources - price & availability More intensive competition from fossil fuels technologies is noticed in public buildings as a result of high energy saving capacity. Poor transferability due to the following reasons: Intense competition from market leading technologies and alternative energy sources prices deformation of the existing subsidies and unequal taxation High installation and maintenance costs and large import taxes on equipment. Credit unwillingness for investments in technologies that are not yet familiar to the public. The overall economic energy policy that is still remaining favourable to fossil fuel energy sources and natural gas. Fossil fuel subsidies which make GSHPs relatively more expensive and less competitive. (see more in text analysis) - Competing plant technologies - price & availability Main competitor of GSHPs is the fossil fuels and natural gas plants and particularly the split air conditioning units. GSHPs and thus the suggested case study present a natural vulnerability to competition against the competitive technologies. (see more in text analysis) Selling power The market prices are controlled according to the selling power of the more mature and strong technology. Selling power of GSHP is limited compared to air-source heat pumps and utilities in the gas sector holding a big share of the energy market. Financial resources Competitors to GHSPs in Greece, have easier access to abundant financial resources, due to their size, profitability, economic status and multi-national coverage. Distribution network and infrastructure Applicability of technology and use (public building, industry & SMEs sector, and/or agriculture) Visibility of the BP and promotional activity The visibility of GSHP systems in the customers and end-users of the commercial sector that cover a large volume of heating, cooling and DHW demands is effectively assisting the promotion activities of geothermal energy. Split air conditioning unit suppliers and dealers have excellent distribution networks and infrastructure reaching even the most remote customer. Natural gas utilities have also good gas distribution piping network, covering the mainland cities. Competing technologies cover the entire market, leaving no market segments free for GSHPs. The threat is coming from the already mature technologies (natural gas, air source split units, diesel boilers) and other promising renewable energy technologies (e.g. biomass and solar thermal technology). Long term intense promotional activity of competing technologies through all types of communication and marketing channels and events have increased their visibility among energy users and the public, while keeping the visibility of GSHPs to low level Centre for Renewable Energy Sources and Saving 9

20 4) Name of region/area: GREEK MARKET : Ohlsdorf, -family house in the Greek market External analysis Opportunities (O) Threats (T) Score Market segment Market segment size (geothermal energy for heating and cooling) Growth rate Interest from customers Degree of acceptance Taking for granted the state s intention to support RES technologies and energy saving measures, the installation of GSHP systems in building sector promises a better future in line with the EU requirements. Neutral. Not applicable. The provisions for a further development of the market are promising due to political support in promotion of energy saving in buildings. RES technologies and promotion through mass media have made the public familiar in innovative systems increasing the degree of adaptability between end-users. A significant transferability above average is recently noticed amongst private end-users. GSHPs are well - accepted among Greek end-users due to sustainability, noiseless, reliability and environmental friendliness of this technology. The market of GSHPs in Greece remains small and not so attractive in case of an old system which only cover the heating demands such as the proposed BP in Ohlsdorf. The specific system is regarded old-fashioned to attract a potential market of customers and commercial companies especially in Greece with high cooling demands during the summer. The proposed BP do not constitute the best case study example due to not covering the combined air-conditioning house demands (heating, cooling and DHW). Price sensitivity Very high due to high turn-key and O & M costs and the lack of regulations or other market rules and incentives (e.g. no subsidies) Attracting cooperation Job creation potential Government subsidies and incentives PV sector, solar thermal sector, drilling companies, HVAC, engineers, architects, R & D centers. Due to economic recession, it is recently noticed many companies and professionals switching to green energy amongst the geothermal energy. The further development of GSHP market will result to establishment of new business and retailing companies and thus to significant opening of new jobs. New feed-in tariff policy (law no. 385/00), regulations and structural measures under consultations, motivate stakeholders to promote GSHP technology with faster steps. The high drilling costs, the lack of regulations compared to other technologies. The process of legislation enacting is hindered by the bureaucracy and partly by the current economic situation. Economic policy has been focused in austerity measures imposed by EU against the economic recession. Growing economy Economic recession, low liquidity and loans in suspension in the last years constitute a limiting factor in investing attraction. Taxation Tax imposition in Greece follows an increasing trend for any organization or firm. Taxation in Greece varies from 0% 40% depending on the firm size / the income of end-user, the scale of taxation and other factors as well. Investor interest Due to rising oil prices and domestic taxation on oil, interest of investors is high and growing, as GSHPs are a new promising technology for both companies and householders. Inhibitor factor: Economic recession Centre for Renewable Energy Sources and Saving 0