Geothermal Isn't Expensive: The Reservoir Always Has the Final Say Somewhere beneath a volcanic ridge, a drill bit is turning through rock that has not moved in two million years. It costs money every second it turns. And nobody on the surface — not the engineer, not the financier, not the minister who announced the megawatts — knows yet whether that well will produce steam or silence. That single moment explains almost everything people get wrong about geothermal energy. Geothermal is routinely described as expensive, slow, capital-hungry and haunted by drilling risk. Investors are reminded that tens of millions can disappear underground before a single megawatt reaches a grid. All of that is true. But it is not the whole truth. The uncomfortable question the industry keeps avoiding is this: is geothermal expensive, or is the way we develop geothermal making it expensive? Those are two completely different problems. One is geology. The other is us. Why Geothermal Refuses to Be...
Ormat Secures 25-Year PPA Extension – Powering Southern California with Geothermal Energy Until 2052
In an era where the world’s energy future hinges on reliability, resilience, and sustainability, Ormat Technologies has just delivered one of the most significant announcements in the geothermal sector. On August 25, 2025, the Nevada-based geothermal powerhouse confirmed the signing of a 25-year power purchase agreement (PPA) extension with the Southern California Public Power Authority (SCPPA).
This milestone means that the Heber 1 geothermal facility, located in California’s Imperial Valley, will continue delivering 52MW of clean, around-the-clock electricity to millions of Californians until 2052. For the Los Angeles Department of Water and Power (LADWP) and the Imperial Irrigation District (IID), this deal secures a cornerstone of California’s baseload renewable energy future.
A Cornerstone of California’s Clean Energy Transition
“This agreement demonstrates both the promise of geothermal energy and Ormat’s ability to deliver reliable renewable power at scale,” said Doron Blachar, CEO of Ormat .
The Heber complex, of which Heber 1 is a flagship unit, currently delivers 91MW of carbon-free power electricity that flows 24/7, unlike solar or wind, making geothermal an indispensable partner in California’s ambitious climate and grid reliability goals. With state mandates requiring 100% clean energy in the coming decades, Ormat’s long-term commitment places geothermal in the spotlight as a baseload anchor of the energy transition.
What This Means for California
For the Los Angeles Department of Water and Power, this agreement goes beyond just numbers. The Heber 1 plant is expected to supply power to more than 77,000 households in Los Angeles, bolstering grid stability while lowering dependence on fossil fuels.
“Geothermal energy plays an important role in building a resilient, sustainable future for Los Angeles,” said David Hanson, LADWP’s Senior Assistant General Manager of Power System. “Investing in geothermal is not just about climate goals; it’s a strategic decision for long-term energy security.”
Meanwhile, the Imperial Irrigation District, serving hundreds of thousands of residents in California’s agricultural heartland, hailed Ormat’s extension as a continuation of a decades-long partnership. “IID continues to be a longtime supporter of renewable energy in the Imperial Valley, and we fully support Ormat’s work to continue this,” said Gina Dockstader, IID Board Chairwoman.
Ormat : A Global Leader with Local Impact
With more than six decades of experience, Ormat is not only the leading geothermal developer in the U.S. but also the only vertically integrated company in the sector—designing, manufacturing, and operating its power plants. Globally, Ormat has installed or owns projects with a combined capacity of 3,400MW, including ventures in Kenya, Guatemala, Indonesia, Honduras, and Guadeloupe.
Today, Ormat’s operational portfolio totals 1,558MW across geothermal, solar, and energy storage assets—making it a quiet but powerful engine driving the clean energy revolution.
Why This Matters
Geothermal is often called the “sleeping giant” of renewables steady, invisible, and vastly underutilized compared to wind and solar. Deals like this 25-year PPA extension show why the technology cannot be ignored. While solar panels depend on sunshine and wind turbines depend on weather, geothermal delivers constant, uninterrupted power from the Earth itself.
By extending the Heber 1 agreement until 2052, Ormat is doing more than just signing a contract. It is cementing geothermal’s role in California’s clean energy portfolio for the next three decades.
And with 77,000 Los Angeles homes soon to rely on the Heber facility, this isn’t just about megawatts it’s about families, communities, and the future resilience of California’s grid.
✅ Key Takeaway:
Ormat's 25-year PPA extension with SCPPA is not just a business deal—it’s a landmark step in ensuring California’s energy security, stability, and climate leadership. With Heber 1 powering homes until 2052, the Earth’s heat has once again proven to be one of humanity’s most reliable allies in the journey toward a carbon-free future.
Source:Ormat
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