This study examines the cost structure of geothermal heat production for district heating in Switzerland, focusing on deep hydrothermal systems at depths between 1,000 and 2,500 meters. Using a techno-economic model, the analysis evaluates the impact of technical and financial parameters — including geothermal flow rate, production temperature, load factor, investment costs, and discount rate — on the levelized cost of heat (LCOH).

While deeper systems involve higher investment costs, they may result in lower LCOH due to higher production temperatures and reduced energy costs. The analysis also emphasizes the critical role of subsurface uncertainties, particularly reservoir characteristics that affect flow rate. Additional considerations include prospection costs and financial risks related to dry or underperforming wells, which are especially relevant in Switzerland's context of limited subsurface data. The findings offer key insights and practical recommendations to enhance the economic viability and strategic planning of geothermal district heating projects.