Entering the &#34;14th Five-Year Plan,&#34; what role will geothermal energy play in the new energy system? Many industry insiders have stated that geothermal will take on a complementary role alongside wind power and photovoltaics, each showcasing its strengths.
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Geothermal energy has core advantages of being environmentally friendly, low-carbon, renewable, stable, and abundant. The development of geothermal resources in China has progressed rapidly after years of technological accumulation. By the end of 2025, the application area for geothermal heating and cooling is expected to reach 1.65 billion square meters.
The &#34;14th Five-Year Plan&#34; period is a critical stage for the development of China's geothermal industry, with the national level issuing a series of policy documents such as &#34;Several Opinions on Promoting the Development and Utilization of Geothermal Energy&#34; to strengthen the top-level design of the industry. How will the geothermal industry develop during the &#34;15th Five-Year Plan&#34;? Nie Xiaowei, director and party secretary of Sinopec Jianghan Petroleum Administration Co., Ltd., suggested promoting the formulation of the &#34;Regulations on the Management of Geothermal Energy Development and Utilization&#34; and establishing a national major science and technology project to break through deep geothermal development technologies to accelerate the release of geothermal industry value.
Heat Underground, Barriers Above Ground
Li Gensheng, an academician of the Chinese Academy of Engineering, stated that China's total geothermal reserves amount to 857.25 trillion tons of standard coal, making it a major country in the direct utilization of geothermal energy, ranking first in the world.
However, due to factors such as unclear strategic positioning, prominent core technology bottlenecks, and imperfect policies and regulations, the annual utilization of geothermal resources is only 40.19 million tons of standard coal, and the resource potential has not been fully released.
Conflicting management systems have become a barrier to geothermal development.
Geothermal energy carries multiple labels; it is like water, like minerals, and like heat. The natural resources department manages mining rights, the water resources department manages water extraction permits, the housing and urban-rural development department manages heating planning, and the energy department manages the utilization of clean energy. A geothermal project often takes years to complete all approval processes.
The &#34;multiple management&#34; pattern leads to a lack of coordination in policy formulation, with overlapping administrative approval processes that not only increase compliance costs for enterprises but also restrict unified planning and efficient development of resources.
What adds pressure on enterprises is the tax and fee policies. Li Gensheng pointed out that geothermal is currently the only renewable energy that needs to pay resource tax, with tax rates and transfer revenue ratios significantly higher than those for oil, natural gas, and coal. This means that, as a clean energy source, geothermal projects start off with a heavier cost burden. In contrast, wind power and photovoltaics enjoy subsidies, green electricity trading, tax reductions, and other policy benefits, while geothermal often stands outside.
This policy gap directly affects market choices. For example, an initial investment of millions is required for a geothermal heating project, with a long return period; whereas an air-source heat pump or photovoltaic project of the same scale, due to clear subsidy channels and financing support, is easier to calculate profitability. Many industry insiders have stated that the issue is not that geothermal technology is unfeasible, but that policies have not kept pace.
Old Oil Fields Build New Heat Fields
Some enterprises have never stopped exploring the geothermal industry
In Dongying, Shandong, at the Dongyi Joint Station of Sinopec Shengli Oilfield, two gas wells have completed their identity transformation. They were once abandoned gas wells, but now they have become geothermal source wells. The project employs a dual heat source cascade heat exchange technology of &#34;high-temperature waste heat from gas wells + medium-temperature waste heat from oil wells,&#34; extracting waste heat from a depth of 3,200 meters underground, replacing the traditional gas heating in the station.
This marks a breakthrough in the large-scale industrial application of medium and deep geothermal resources in the oil and gas sector. According to estimates, the project has an annual clean heating capacity of 209,000 gigajoules, reducing heating costs by 59%, replacing 6.38 million cubic meters of natural gas, and reducing carbon dioxide emissions by 13,500 tons annually. &#34;The coordinated development of oil fields and geothermal resources provides a replicable and promotable successful model for the clean transformation of the traditional oil and gas industry, which is of great significance for achieving new energy in the oil and gas industry and promoting the adjustment of the national energy structure,&#34; commented Sun Huanquan, an academician of the Chinese Academy of Engineering and director of the National Key Laboratory for Deep Geothermal Enrichment Mechanisms and Efficient Development.
Not only that. In the Guda Oilfield, the first medium and deep geothermal project for oil and gas production in Shandong Province, utilizing two abandoned wells, has been put into operation; in the Xinjiang Junggar Basin, the waste heat utilization project at the Chunfeng Joint Station has an annual heating capacity of 270,000 gigajoules. So far, Shengli Oilfield has established 51 various geothermal waste heat utilization projects, revitalizing 25 abandoned wells, with an annual clean heating capacity of 3.46 million gigajoules.
Li Gensheng suggested establishing a geothermal development guarantee mechanism in key areas and implementing large-scale replacement of geothermal heating in a classified manner. In his view, the coupling and collaboration of geothermal energy with wind power, photovoltaics, and other energy sources can enhance the absorption capacity of new energy, allowing geothermal power generation to play a foundational and supportive role in the new power system.
Awakening More Geothermal Resources
As we enter the 14th Five-Year Plan, what role will geothermal energy play in the new energy system? Many industry insiders believe that geothermal will have a role that is equal and complementary to wind power and photovoltaics, each showcasing its strengths.
At the policy level, the 14th Five-Year Plan is expected to be the five years in which the geothermal industry truly gains &#34;identity recognition.&#34; Nie Xiaowei suggested establishing a dedicated chapter for geothermal development in the national energy development plan for the 14th Five-Year Plan, clarifying development goals and key areas by 2030.
&#34;Research and formulate national, inclusive fiscal subsidy and price support policies covering geothermal heating and power generation, ensuring that their policy treatment is on par with renewable energies such as wind power and photovoltaics. At the same time, guide financial institutions to include geothermal projects in the key support areas of green credit and green bonds, and establish a national geothermal industry development fund to attract social capital investment,&#34; Nie Xiaowei suggested.
If these recommendations are implemented in the future, geothermal energy will transform from a marginal role reliant on policy &#34;blood transfusions&#34; to a mature industry capable of self-sustaining.
In addition, at the technical level, Chen Zemin, chairman of Wanjiang New Energy Co., Ltd., stated that with the continuous upgrading and iteration of technology, geothermal energy is not only being widely applied in urban residential heating but is also expanding into more application scenarios such as hospitals, schools, airports, high-speed railway stations, zero-carbon parks, high-end agriculture, and industrial steam. The expansion of application scenarios is opening up new imaginative spaces
The government is also &#34;voting&#34; for geothermal energy. On March 9, the Beijing Municipal Development and Reform Commission issued a notice to publicly solicit new energy heating projects supported by the municipal government's fixed asset investment. Shallow geothermal heat pumps, medium and deep water geothermal, and medium and deep underground heat exchange geothermal are all included in the support scope. Projects with a new energy heating installed capacity ratio of 60% or above will receive 30% municipal government fixed asset investment support for new energy construction.
With the acceleration of technological iteration, optimization of the policy environment, and continuous improvement of carbon market mechanisms, China's geothermal industry is expected to enter a golden development period characterized by deep geothermal development, urban clean heating upgrades, expansion of industrial application scenarios, and the realization of carbon asset value. The thermal energy buried deep underground will also be more completely &#34;awakened.&#34;
Written by | Our reporter Qu Peiran
Produced by | China Energy News (cnenergy) Edited by | Yan Zhiqiang

The geothermal industry plays an important role in the new energy system and needs to clarify its identity. Industry insiders point out that geothermal energy complements wind power and photovoltaics, with advantages such as environmental protection, low carbon emissions, and renewability. Insufficient policy support, complex management systems, and heavy tax burdens restrict development. It is recommended to formulate the "Regulations on the Management of Geothermal Energy Development and Utilization" to promote deep geothermal development technology and unleash the industry's potential

The geothermal industry calls for "identity recognition"