The change in internal energy is only gravitional PE because the tube is being drug up at a constant speed. Since it is at a constant speed, the change in KE is 0.
Change in PE = m*g*h = 78 kg * 10 m/s^2 * 30 m = 23400 J
Work done on the system is from the force
Work = force * distance = 350 N * 120 m = 42000 J
So, work added 42000 J to the system, but the rider's energy only increased 23400 J. Therefore, friction took up the difference. Friction is where the thermal energy comes from
Q = 42000 J - 23400 J = 18600 J.
Therfore, friction generated 18600 J of heat to the surroundings.