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Valuing uses of the Waikato regional geothermal resource

TR 2011/15

Report: TR 2011/15

Author: S Barns and K Luketina


Geothermal resources are a valuable asset to the Waikato region. They contribute to the regional economy through tourism, electricity generation and ecosystem services such as the provision of genetic resources and cultural values, particularly those of
tangata whenua.

The purpose of this report is to estimate the annual value of geothermal resources to the Waikato region. This has been described quantitatively where information exists to do so and qualitatively where such information is not
currently available.

A survey was conducted between April 2011 and June 2011, and multiplier analysis was used to estimate the value of geothermal resources to the Waikato region. The survey and analysis investigated:

  • the numbers of visitors from domestic and international sources visiting
    geothermal attractions in the Waikato region
  • the numbers of staff employed in tourism and direct heat facilities in the
    Waikato region
  • the value of geothermal tourism to the Waikato region
  • the value of geothermal generation to the Waikato region
  • the amount of geothermal energy used in commercial and domestic direct heat applications (i.e. non-electricity) in the Waikato region.

The quantitative analysis of the contribution of geothermal resources to the regional economy through tourism and generation, and the qualitative description of direct uses and other ecosystem services will provide policy makers with a framework for
considering the impact of decisions on the many benefits provided by the geothermal resources of the Waikato region.

Valuing uses of the Waikato regional geothermal resource [PDF, 578 KB]

1 Introduction 1
2 Definitions 3
2.1 Geothermal attraction 3
2.2 Direct heat applications 4
2.3 Geothermal electricity generation 4
3 Dangers of geothermal attractions 5
4 Tourism 6
4.1 Geothermal tourism 6
4.2 Geothermal tourism in the Waikato region 6
4.3 Tourism numbers: Survey results 8
4.3.1 Bathing as part of tourist accommodation facilities (23 sites) 8
4.3.2 Pay bathing (9 sites) 10
4.3.3 Free informal bathing (10 sites) 11
4.3.4 Nature tourism (5 sites) 12
4.3.5 Technology-related tourism (3 sites) 13
4.3.6 Summary of visitor results 13
4.4 Geothermal tourism - contribution to the regional economy 14
4.4.1 Business survey results 14
4.4.2 Multiplier analysis 14
4.5 Geothermal tourism - employment 17
4.5.1 Business survey results 17
4.5.2 Multiplier analysis 17
4.6 The future of geothermal tourism 18
4.7 Costs and benefits of geothermal tourism 19
5 Geothermal electricity generation 21
5.1 Renewable energy 21
5.2 Geothermal generation in the Waikato region 23
5.3 Value of geothermal generation in the Waikato region 24
5.4 Geothermal generation - employment 25
5.5 The future of geothermal generation 26
5.6 Benefits and costs of geothermal generation 27
6 Direct use of geothermal energy 28
7 Geothermal ecosystem services 33
7.1 Geothermal and ecosystems 33
7.2 Value to the region 34
7.3 The future of ecosystem services from geothermal resources 35
8 Other economic values 36
8.1 Option values 36
8.2 Existence, altruistic and bequeath values 36
9 Allocation of geothermal water and energy 37
10 Discussion 39
11 Conclusion 41
12 Glossary 42
13 References/Bibliography 43