ABSTRACT APPLICATION OF NON-MARKET ECONOMIC VALUATION METHOD TO VALUE THE ENVIRONMENTAL BENEFITS OF GEOTHERMAL ENERGY IN MONETARY TERMS: A CASE STUDY IN YOZGAT PROVINCE Horasanli, Erol M.Sc., Department of Environmental Engineering Supervisor: Assist. Prof. Dr. Emre ALP December 2010, 100 pages Determining environmental economic benefits of geothermal energy is difficult since there is no market for all environmental goods and services related to it. In order to determine and measure the market price of non-market goods and services, non-market valuation methods are used. Since intangible benefits do not have monetary values, non-market valuation techniques are applied to estimate them. Non-market valuation methods are important tools for policy makers in the cost and benefit analysis and environmental impact assessment process to aid their final decision. In this study, the Contingent Valuation Method (CVM) was used to determine the environmental benefits of using geothermal energy for house heating instead of fossil fuels and natural gas in Yozgat (center). The willingness to pay for geothermal energy of the Yozgat residents was determined and underlying motivations to use geothermal energy were assessed. The results showed that the mean willingness to pay (WTP) for the usage of geothermal energy in house heating to increase air quality and mitigate the effects v of climate change is $50/person/month. The results also showed that respondents know the importance of the climate changes and they believe that geothermal energy usage will affect the mitigation of climate changes positively. The geothermal energy investment in the region will amortize itself in 3 years. Therefore, in the feasibility studies, geothermal energy investment seems feasible. During the regression analyses, climate change and air pollution parameters were the most significant parameters for the calculation of mean WTP. Since, decrease in air pollution using geothermal energy, will also mitigate the effect of climate changes, during the geothermal investment in the region, training activities and campaigns should be carried to cover the issues of climate change and global warming to emphasis that geothermal energy will serve for multi-dimensional environmental problems.