Multidimensional Strategic Outlook on Global Competitive Energy Economics and Finance

Hasan Dinçer, Serhat Yüksel, Hasan Dinçer, Serhat Yüksel

• Publisher: Emerald Publishing Limited
• Year: 2022
• Print ISBN: 9781801178990
• eBook ISBN: 9781801179003
• Topic: Economics
• Subtopic: Sustainability in Business
• Index: Economics

Economical energy supply is vital for a country's financial success, and factors such as price, continuity, environmental pollution and the country's own energy resources are important contributors.

Multidimensional Strategic Outlook on Global Competitive Energy Economics and Finance analyses current trends in energy production and use, with a focus on technological developments that contribute to the reduction of price in energy production and renewable energy sources that provide continuity in energy production and do not emit carbon into the atmosphere.

Expanding on the current literature, this book focuses purely on current issues that can increase energy efficiency, while proposing strategies to use energy more effectively and efficiently. The strategies presented in this book will be a significant guide to both academics and industry professionals.

Chapter 1

Identifying New Perspectives on Geothermal Energy Investments

Zafer Adalı, Hasan Dinçer, Serkan Eti, Alexey Mikhaylov and Serhat Yüksel

Abstract

This chapter aims to identify new perspectives of geothermal energy investments. For this purpose, all studies in the Web of Science regarding the geothermal energy are taken into consideration. These studies are evaluated with the help of text-mining approach. In this framework, most frequently stated words, two words, and three words are identified. It is concluded that technological development with respect to the geothermal energy is an important issue in this framework. After that, it is also determined that risk is another important factor in this regard. Finally, new implications regarding the geothermal energy are also considered by the researchers. Geothermal energy has a positive contribution to solve many different problems, such as energy dependency, current account deficit problem, and carbon emission. Hence, this study generated the significant issues to improve these investments. While considering the results, it is understood that technological developments related to the geothermal energy projects should be followed effectively. In addition, an effective risk evaluation should be conducted before implementing these projects.

Keywords: Geothermal; energy investment; risk evaluation; technological development; text mining; web mining; renewable energy; carbon emission; energy dependence; current account deficit

1.1 Introduction

Energy has a very important role in both human life and economic development. In other words, energy is a necessity that must be supplied (Dinçer et al., 2019). Therefore, there is an obligation to supply energy, regardless of its price. As can be understood from this, the situation is much easier for countries that have energy reserves (Zhao, Xu, Yüksel, Dinçer, & Ubay, 2021). These countries can meet their energy needs without being dependent on others. On the other hand, there are some risks for countries that do not have energy reserves. As mentioned earlier, the supply of energy is mandatory. Therefore, countries with energy reserves can meet these needs themselves (Yüksel, Mikhaylov, & Khomyakova, 2021).

There are three different paths in front of countries that do not have energy reserves. First, these countries can meet their energy needs by purchasing from other countries (Fang, Zhou, Dinçer, & Yüksel, 2021). However, in this way, they become dependent on the other country both politically and economically. The second way is to increase energy exploration activities in their own countries. A country may have as yet undiscovered reserves (Haiyun, Zhixiong, Yüksel, & Dinçer, 2021). Therefore, it is possible to detect these reserves with extensive exploration activities. In this way, countries can meet their energy needs without being dependent on others. On the other hand, despite extensive exploration efforts, energy reserves may not be found in a country (Dinçer & Yüksel, 2019).

The third way that countries that do not have energy reserves can apply is the development of renewable energy projects (Yüksel, Dinçer, & Meral, 2019). Renewable energy projects aim to generate energy using natural resources such as the sun and wind. The biggest advantage of these types of energy is that they reduce environmental pollution (Du, Dinçer, Ersin, & Yüksel, 2020). These types of energy contribute significantly to the solution of the carbon emission problem. In addition, renewable energies also help countries to produce their own energy. In this way, the dependence of countries on foreign energy will decrease (Meng, Dinçer, & Yüksel, 2021).

Geothermal energy is one of the renewable energy types that has increased in popularity especially in recent years. It is aimed to obtain electricity by using the steam of hot water underground. As can be seen, it is possible to minimize environmental pollution thanks to geothermal energy. On the other hand, geothermal energy is not affected much by climate and weather conditions. This situation brings geothermal energy to the forefront compared to other renewable energy types. In this study, it is aimed to identify new perspectives on geothermal energy investments. For this purpose, studies regarding geothermal energy investments are evaluated with the help of text mining methodology.

1.2 General Aspects of Geothermal Energy Investments

Adequate energy sources have been accepted as the cornerstone of economic development, and ordinary people's lives worldwide have become more dependent on energy in especially last three decades. Communication, transportation, cooking, heating, and even education have been integrated with energy. Without energy, the modern civilization is not envisioned. The primary energy resources involving oil, natural gas, and coal play a critical role in fulfilling social and economic demands. The primary energy resource is nonrenewable energy sources. They are limited in supply and are eventually subject to run out of fatefulness. Along with the unsustainable appearance of nonrenewable energy resources, environmental degradation has been experienced because of the devastating effects of these energy sources used. CO₂ emission, marine pollution, water degradation, and habitat destruction are regarded as the detrimental effects of nonrenewable energy resources. The nonrenewable energy sources based on limited supply lead the world to the prepper. These unintended scenario has been documented many international nongovernmental and governmental institutions. For example, Intergovernmental Panel on Climate. Change's (2018) report indicates that economic activities push the global temperature to approximately 1°C compared to the preindustrial level. Unless the current energy usage and economic habit do not change, the global warning seems to pass 1.5°C between 2030 and 2052. This incremental rise will cause various animal species extinction, drought, and rising sea levels. In addition to scientific reports, many international agreements and engagements (the Kyoto Protocol and Paris agreement) have been prepared to show evidence of the detrimental effects of human activities. They offer a set of solutions to prevent these harmful experiences (Çelik, Korkmaz, & Adalı, 2021). At this point, regarding investigating all documents, agreements, national legal documents, it can be indicated that renewable energy sources seem to be prevailing solutions to overcome environmental degradation and substitute nonrenewable energy sources to meet daily and economic demands (Yu et al., 2019). Renewable energy resources are equipped with many advantages. For example, renewable energy technologies use the power generated by the environment, such as sun, wind, and thermal, so the renewable energy resources will not run out in contrast to nonrenewable energy resources (Li, Wu, Dinçer, Kalkavan, & Yüksel, 2021). Furthermore, renewable energy generates few greenhouse or pollutants into the air compared to nonrenewable energy resources, renewable diminish reliance on foreign energy sources, and its maintenance requirements are lower. The environmental degradation caused by the nonrenewable energy sources and the fostering of sustainable economic development have generated massive pressure on policymakers worldwide to accelerate the utilization level of renewable energy sources. Biomass, solar, wind, and hydropower have been widely recognized as the most important renewable energy sources to substitute nonrenewable energy sources because of several environmental and economic advantages (Liu, Dinçer, Eti, & Yüksel, 2021).

Among the renewable energy resources, geothermal energy resources are a particular case, and the usage of geothermal energy resources relies on the countries' specific geographic position. Geothermal energy is a unique energy source located in one area based on the near tectonic plate boundaries worldwide. In other words, geothermal resources can be reached in the area linked to active fault systems, volcanic and magmatic units (Malafeh & Sharp, 2015). Literally, geothermal is made up of two Greek words; Geo signifies earth, and thermal denotes heat. The word combination means that energy is generated from the ground (Alhamid et al., 2016). Regarding scientific explanation, geothermal energy is a kind of thermal energy achieved by some artificial process applied to hot water, steam, hot, dry rocks, and dry steam. The heat of fluids or stones is generated from the original composition of the planet and radioactive decay materials (Carella, 2001) This thermal form is collected in rocks and fluids in the core of the earth. The difference between the earth's heart and the outside induces continuous conduction of thermal energy from the center to the planet's surface. For example, to produce electricity via geothermal energy, wells are dug a mile deep into underground reservoirs to access the steam and hot water, which is transferred to drive turbines connected to electricity (Devrim Elvan & Turker, 2013).

The utilization of geothermal energy can be categorized into two views: direct utilization of the geothermal sources and converting geothermal sources into electrical energy. The type of utilization relies on the temperature of geothermal resources. 20° – 70°C is considered low temperature, and low-temperature fields are employed in industry, producing chemicals and other direct utilizations. Intermediate-temperature referring 70° – 150°C and high-temperature presenting above 150°C is used for electricity generation and integrated heating system named indirect utilization. The direct utilization of geothermal energy is one of the oldest energy utilizations in human history, and the historical evidence indicates that geothermal energy has been used as the direct utilization in 25 countries for more than 2000 years. Agriculture applications, aquaculture, heat pumps, industrial processes, swimming, bathing, heating, food dehydration, milk pasteurizing, and cooling are the major geothermal energy direct utilization areas (Bakos, 2007; Mertoglu, Bakir, & Kaya, 2003). Heating and cooling buildings via geothermal energy have been received massive attention in recent decades. Geothermal energy is utilized to heat and cool buildings with the help of district heating systems or directly piped into buildings and industries. This system is named geothermal heat pumps and is based on a principle that transfers heat from the reservoir into a building during the winter and reverses the process in the summer. Generally, the direct utilization of geothermal is associated with small-scale projects, whereas the latest technological development induces the direct utilization to become more efficient and more essential energy resources. For example, district heating in Iceland and France, greenhouse complexes in Hungary and Russia, and significant industrial uses in New Zealand and the USA are examples of larger-scale projects with the help of technological developments (Barkaoui, Boldyryev, Duic, Krajacic, & Guzović, 2016; Devrim Elvan & Turker, 2013; Erdogmus, Toksoy, Ozerdem, & Aksoy, 2006; Melikoglu, 2017).

In contrast to direct utilization, the electricity generation from geothermal energy has become popular since the 1970s and 1980s, which marked the years the energy crisis experienced worldwide while electricity has been generated from geothermal energy through conventional electricity hydrothermal resources for more than 100 years (Ghose, 2004). The first geothermal steam well was dug in Italy in the year 1904 by Prince P. G. Conti. In the exact location, the first geothermal plants began to operate and generate electricity in 1914 (Fridleifsson, 2001; Hepbasli & Ozgener, 2004). However, the electricity generation coming from geothermal energy sources is more complicated and needs some requirements compared to direct utilization. First of all, geothermal power plants should be built to utilize hydrothermal resources involving water (hydro) and heat (thermal), turning a turbine and creating electricity. Operating fluid temperatures above 150°C is a threshold for conventional electricity generation, whereas improved technologies, especially the binary system, allow for using lower temperatures to generate electricity. Generally, three significant technologies are operating in geothermal plants to produce electricity from geothermal reservoirs. Dry-stream power plants are one of the leading technologies. These plants use high-heat, vapor-dominant, hydrothermal reservoirs, and steam from the well transfers straight by the turbine-generator unit. Flash-steam power plants are preferred when a liquid-dominant compound is produced at the wellhead of the hydrothermal reservoir. Flash-steam power plants are divided into two subpower plants: single flash and double flash power plants. The single flash plants are worked by separating the mixture from the wellhead into different phases in a flash vessel. The vapor obtained from this separation process is transferred to the turbine-generator unit. The double flash power plants receive more energy output from the identical geothermal reservoir than single flash power plants. Finally, binary power plants are based on Kalina or Rankine cycles and are used when the water temperature in the geothermal reservoirs is not adequate compared to...

Table of contents

• Cover
• Title
• Copyright
• Table of Contents
• List of Tables
• About the Contributors
• Chapter 1 Identifying New Perspectives on Geothermal Energy Investments
• Chapter 2 Theoretical Foundations of the Relationship between Energy Investment, Monetary Conditions, Financial Development, and Economic Growth
• Chapter 3 Do Energy Use and Environmental Pollution Cause Income? A Study on the BRICS Nations
• Chapter 4 Relationship between Energy Investment and Economic Growth
• Chapter 5 The Effect of Emotional Intelligence Levels on Leadership: An Application in the Energy Sector
• Chapter 6 Measuring the Nonlinearity of the Relationship between Finance and Energy Investment
• Chapter 7 Method for Assessing the Nature of the Relationship between Energy Investment and Finance with the Criteria of Monetary Factor Thresholds
• Chapter 8 Evaluation of the Hypothesis of Nonlinear Relationship between Finance and Energy Investment
• Chapter 9 The Impacts of Energy Usage and Economic Growth on the Ecological Footprint and CO2 Emissions: The Case of G-7 Countries
• Chapter 10 Assessment of the Nature of the Relationship between Energy Investment and Finance
• Chapter 11 Importance of Renewable Energy Investments for Qualified Workforce
• Chapter 12 Is the Energy-Hungry Bitcoin Beneficial for Portfolio Risk Reduction?
• Chapter 13 Bitcoin Mining with Nuclear Energy
• Index