The 2025 U.S. Geothermal Market Report published by the National Laboratory of the Rockies & Geothermal Rising

The 2025 U.S. Geothermal Market Report published by the National Laboratory of the Rockies (NLR, formerly NREL) in collaboration with Geothermal Rising and supported by the U.S. Department of Energy's Geothermal Technologies Office (GTO), provides a comprehensive update on the geothermal sector since the 2021 report.

By: Robert Buluma

Released in 2025 (with data through mid-2025), it expands coverage to include geothermal heat pumps (GHPs) for single-building and district applications, alongside power generation and direct use. The report highlights steady growth in installed capacity, accelerating investment in next-generation technologies like enhanced geothermal systems (EGS) and closed-loop geothermal (CLG), cost declines, policy support, and emerging opportunities driven by demand for reliable, 24/7 clean energy.

Geothermal Power Generation: Steady Growth and Momentum

U.S. geothermal power has seen consistent expansion, with nameplate installed capacity reaching 3,969 megawatts-electric (MWe) as of 2024 an 8% increase from 3,673 MWe in 2020. This net gain includes 246 MWe of new plants, 132 MWe from expansions and additions, offset by 82 MWe in retirements. Net summer and winter capacities also rose, from 2.56 GWe and 2.96 GWe in 2019 to 2.69 GWe and 3.12 GWe in 2023.

Development remains concentrated in the western U.S., where high thermal gradients and known resource areas enable viability. California dominates with 53 of the nation's 99 plants and 2,868 MWe (72% of total capacity). Nevada follows with 32 plants and 892 MWe. Smaller contributions come from Oregon, Utah (four plants each), Hawaii and Alaska (two each), and Idaho and New Mexico (one each).

A surge in power purchase agreements (PPAs) signals strong future growth. Since 2021, 26 new PPAs represent over 1.64 GWe in commitments. California's 2021 procurement order drove at least 616 MWe in agreements, including imports of firm power from Nevada and Utah. Next-generation systems (EGS and CLG) comprise 60% of recent PPAs, totaling 984 MWe across states like California (439 MWe), Nevada, New Mexico, Texas, and undisclosed eastern locations. The first EGS PPA was signed in 2022 between Fervo Energy, Google (via NV Energy), and others for 3.5 MWe, with expansions following.

Projects under development increased from 54 to 64 since 2020. Ormat leads conventional hydrothermal with 37 projects, while Fervo (four), Sage Geosystems, and Eavor (two each) pioneer next-gen.

Technological progress is rapid. DOE's Frontier Observatory for Research in Geothermal Energy (FORGE) in Utah has drilled seven wells, slashing on-bottom drilling hours from 310 in 2020 to 110 in 2023. Fervo's 2023 Nevada pilot marked the first commercial-scale EGS, with their Cape Station project in Utah targeting a 500-MWe scale (100 MWe Phase 1 by 2026, 400 MWe Phase 2 by 2028). Eavor achieved a U.S. first in 2022 with a deep multilateral CLG well in New Mexico reaching 18,000 ft and 250°C.

Costs reflect advancement: EGS levelized cost of energy (LCOE) is declining sharply per the 2024 Annual Technology Baseline (ATB) Moderate Scenario, projected to match 2024 conventional flash levels (~$63–74/MWh) within a decade. Conventional hydrothermal LCOE remains stable ($63–74/MWh flash, $90–110/MWh binary), competitive with recent PPAs.

Investment in next-gen geothermal exceeds $1.5 billion since 2021, with EGS firms raising $990 million and CLG $604 million. Fervo secured $642 million equity plus $331 million debt; Eavor raised $387 million equity and $142 million loans. Resource potential is vast: average EGS at 1–7 km depth estimated at 27–57 terawatt-electric (TWe), including 4.35 TWe on public lands (BLM/USFS). Economically developable portions offer significant upside.

Policy support is robust: 29 states provide incentives (grants, rebates, tax credits) for geothermal power; 42 states have regulatory frameworks (e.g., standards, net metering). BLM lands host 51 plants generating 11.1 TWh in 2022.

Geothermal Heating and Cooling: Nationwide Adoption and Grid Benefits

GHPs offer reliable, efficient heating/cooling across all U.S. climates. Extrapolations from EIA's RECS and CBECS estimate 1.27 million residential units and 27,300 commercial buildings with installations. Residential hotspots include Florida, Tennessee, and North Carolina.

Incentives abound: 34 states and D.C. offer GHP support; federal Inflation Reduction Act (IRA) provided a 30% residential tax credit (through 2025) and 6% base commercial credit, with leasing now permitted.

Mass GHP deployment could save up to $1 trillion in grid infrastructure by 2050 (ORNL estimates), reducing generation needs by 585–937 TWh, capacity by 173–410 GW, and transmission by 3.3–65.3 TW-miles.

Thermal Energy Networks (TENs)—fifth-generation district systems with shared ambient loops—are rising. States like California, Colorado, Massachusetts, and New York advance regulations. Eversource's 2024 Framingham, MA pilot connects 36 buildings via borehole fields, modeling utility-led growth.

Geothermal direct use (GDU) includes ~500 installations: resorts/pools (59%, 281 sites), space heating (77), aquaculture (47), greenhouses (37), district heating (25), and others. California leads with 89.

Emerging Opportunities: Resilience, Data Centers, and Innovation

Geothermal bolsters energy security: DoD funded 10+ projects (2023–2025) at bases like Fort Wainwright (AK) and Joint Base San Antonio (TX) for conventional and next-gen tech. Federal GHP projects (2001–2014) delivered cost savings.

Data centers, with load tripling and projected doubling/tripling by 2028, favor geothermal's firm power and thermal storage. PPAs include Meta (150 MWe with Sage, 150 MWe with XG5) and Google (115 MWe expansion with Fervo).

Superhot geothermal could boost well output 5–10x. DOE funds R&D for shallow resources.

Hybrids (e.g., Ormat's Tungsten Mountain), GeoTES (demos in California oil fields), and oil/gas co-production ($8.4 million DOE awards) enhance flexibility. Brine mineral extraction (e.g., 3,400 kilotons lithium at Salton Sea) addresses critical materials.

As of early 2026, momentum continues: Fervo's Cape Station Phase 1 targets grid delivery in October 2026, backed by recent financings ($462 million Series E in late 2025, prior tranches). The sector is poised for exponential growth, unlocking vast domestic potential for decarbonization, resilience, and energy independence.

Source: NRel

Connect with us: LinkedIn, X

Comments

Eavor Demobilizes Rigs in Geretsried: What It Means for Closed-Loop Geothermal Investors, Heat Markets, and Project Risk

Eavor Demobilizes Rigs from Geretsried: What It Really Means for Closed-Loop Geothermal For three years, two drilling rigs on a farm estate near Geretsried, a Bavarian town about 40 km south of Munich, stood as the symbol of the world's most ambitious closed-loop geothermal experiment. Now in October 2026, Eavor Technologies, the Calgary-based developer of the Eavor-Loop, has told the town and its heating utility that both rigs would leave the site . The company said keeping idle rigs and specialist services on site was costly, and that releasing them would help put the project in the strongest position to continue with Loop 2 once its commercial structure is reworked . On the surface, this is a logistics decision. Underneath, it is one of the clearest signals yet about where first-of-a-kind geothermal technology stands, and how hard it is to turn a technical proof into a bankable business. This article explains exactly what happened, what the move means and what it does not mean...

Endurance Energy Tests World's First Subsea Geothermal Well at Axial Seamount

Endurance Energy Tests the World's First Subsea Geothermal Well: What the Axial Seamount Demonstration Really Proved What if geothermal energy did not need a power plant on land? What if electricity could be produced directly from the Earth's heat beneath the ocean, with generators sitting on the seafloor and sending power to coastal grids? On October 19, 2026, Seattle-based startup Endurance Energy announced a major step toward that idea. The company said it had drilled and completed the world's first subsea geothermal well and placed a 3-ton test power plant nearly a mile beneath the Pacific. It also reported net-positive electricity from heat at an active underwater volcano, according to its announcement on PR Newswire. The headline numbers are modest. The Adélie prototype produced more electricity than it used for about 8.7 seconds. During that time it delivered a median net output of about 2 kilowatts and a peak of 16.5 kilowatts. One detail matters more than any other...

Djibouti Pays KenGen: $1M Offer on a Five-Year Geothermal Drilling Debt

Djibouti Pays KenGen: A $1 Million Offer on a Five-Year-Old Geothermal Drilling Debt Djibouti has finally moved to pay part of what it owes Kenya Electricity Generating Company (KenGen) for drilling work done near Lake Assal. The amount is small next to KenGen's balance sheet. What it says about selling geothermal drilling services across Africa matters a lot more. KenGen's latest annual report says Djibouti's state geothermal agency, the Office Djiboutien de Développement de l'Énergie Géothermique (ODDEG), has offered a first instalment of about $1 million (Sh129 million) against outstanding invoices of $2.13 million (Sh276.03 million), according to Business Daily. "ODDEG has acknowledged the debt and has proposed an initial payment of $1 million as the first instalment towards settlement," KenGen said in the report. KenGen is Kenya's largest power producer, with about 54% of the market. The Kenyan government owns 70% of the company and the public holds t...

BLM Nevada Geothermal Lease Auction Boosts Renewable Energy Investment amid Solar Land Conflict

BLM’s Nevada Geothermal Lease Auction Signals Rising Competition for Federal Energy Land The Bureau of Land Management’s latest geothermal lease sale in Nevada attracted nearly $4.83 million in total receipts, highlighting growing investor interest in geothermal resources as electricity demand rises . The auction also exposed an increasingly important land-use conflict: several geothermal parcels overlap with proposed utility-scale solar projects, including NextEra Energy’s 1,000-megawatt Sawtooth Energy Center. The October 20, 2026, sale offered 83 parcels covering approximately 265,155 acres across 10 Nevada counties. Bidders placed offers on 60 parcels covering 186,641 acres, while 23 parcels received no bids. The results provide a new measure of competition for federal geothermal acreage in one of the United States’ most important geothermal states. Auction Results The Nevada auction attracted 32 registered bidders, of which 18 submitted at least one bid. Across the sale, bidders s...

Menengai Geothermal Project Delays Expose Kenya’s Broken Steam Supply Model

Menengai’s Broken Promise: How Kenya’s Geothermal Model Lost the Steam Thematic image of the Olkaria Geothermal Field Kenya’s Menengai geothermal project was sold as a model of modern public-private partnership. The state would carry the difficult and expensive burden of geothermal exploration and drilling. Private power producers would then build, own and operate power plants. Geothermal Development Company would supply the steam; the independent power producers would convert it into electricity; Kenya Power would buy the output. On paper, the arrangement was elegant. In practice, Menengai has exposed a far more uncomfortable reality: Kenya’s public steam-supply model is not delivering the certainty it promised. Menengai Phase I was designed to produce 105 megawatts from three 35 MW plants. GDC’s own project page says the three plants were awarded to Globeleq Menengai Geothermal, Sosian Menengai Geothermal Power and OrPower Twenty Two under a build-own-operate structure. Yet the ...

KenGen Risks Losing Olkaria Geothermal Wells Over Licence Error

KenGen Risks Losing Olkaria Wells Over 18-Year Licence Blunder Kenya Electricity Generating Company (KenGen) faces a serious legal and operational risk at Olkaria after an error in the coordinates of its geothermal licence left part of the company’s wells, steam infrastructure and other assets outside its legally recognised area. The licensing mistake, made nearly two decades ago, remains unresolved despite the Ministry of Energy and Petroleum acknowledging the problem in 2017. The dispute has raised questions about the security of KenGen’s investments, the government’s management of geothermal resources and the potential consequences for Kenya’s electricity supply. Olkaria is the country’s most important geothermal centre and accounts for the overwhelming majority of Kenya’s installed geothermal generation capacity. Licence Error Exposes Strategic Assets The problem dates back to September 19, 2008, when the Ministry of Energy and Petroleum issued KenGen a licence covering ...

Geiselbullach Geothermal Project Confirms 10 MW District Heating Capacity

Geothermal milestone at Geiselbullach: 10 MW of heat confirmed after successful second deep well test On 15 August 2026 the Geiselbullach geothermal project reached a pivotal technical milestone: performance testing of the second deep production well completed successfully, delivering a sustained flow of 90 liters per second of thermal water at 79–80 °C. These measured parameters translate into roughly 10 MW of usable thermal power for district heating, enough to replace a portion of heat currently supplied by the municipal waste-to-energy plant (AHKW) and to create headroom for expanding the regional district heating network. The result confirms the project’s technical assumptions and moves the scheme into system-integration and commissioning activities ahead of planned commercial deliveries for the 2027 heating season. This article explains the test results and their significance, outlines the technical and operational consequences, and places the Geiselbullach development in the bro...

Lithium Harvest Plans Alberta Geothermal Power and Lithium Project

Lithium Harvest’s Alberta Geothermal Project Could Combine Renewable Power and Domestic Lithium Production Lithium Harvest Holding A/S has signed a letter of intent with an unnamed geothermal development partner to establish a joint venture for an integrated geothermal power and lithium production facility in Alberta, Canada. At full nameplate capacity, the proposed project is expected to produce approximately 28,500 tonnes of lithium carbonate annually while generating 0.67 TWh of renewable electricity each year. The development would use a single geothermal resource to supply both baseload power and lithium-bearing brine for direct lithium extraction and refining. A Dual-Output Geothermal Development The proposed Alberta facility reflects a growing effort to extract more value from geothermal resources than electricity generation alone. Traditional geothermal power projects produce electricity by bringing hot underground fluids to the surface. Depending on resource temperature a...

Corva and Oliasoft Connect Well Design With Real-Time Drilling

Corva and Oliasoft Build a Continuous Learning Loop for Smarter Well Construction Introduction Corva AI and Oliasoft have announced a strategic collaboration designed to connect well engineering, real-time drilling operations and post-well analysis through a bidirectional digital workflow. The integration links Oliasoft WellDesign with Corva’s Real-Time AI platform, creating a continuous information loop in which engineering plans guide field execution and drilling results improve future well designs. The partnership addresses one of the persistent weaknesses in modern well construction: the separation between planning software and operational systems. Although operators generate large volumes of engineering and drilling data, those datasets often remain fragmented across departments, applications and reporting processes. The result is slower decision-making, repeated manual work and limited transfer of lessons from one well to the next. By connecting design assumptions with liv...

California Court Orders New Environmental Review for Imperial County Geothermal Lithium Project

California Appeals Court Orders New Environmental Review for Imperial County Geothermal–Lithium Project Image: California Salton Lake Sea Hell’s Kitchen geothermal and lithium extraction plan sent back for deeper water, air-quality and mitigation analysis under CEQA A California appeals court has ordered Imperial County to conduct a more rigorous environmental review of the proposed Hell’s Kitchen geothermal power plant and lithium extraction project near the Salton Sea. The Fourth District Court of Appeal found that the county’s original environmental impact report (EIR) did not adequately address long-term water availability, enforceable mitigation measures for water shortages, or potential air-quality impacts tied to the receding Salton Sea. The ruling partially reverses a lower court decision and remands the case to Imperial County Superior Court, requiring the county and project developer Controlled Thermal Resources to address the identified deficiencies before the project can m...

ALPHAXIOMS Geothermal News & Energy Research

Search This Blog

Just In

Estonia Drills Three Towns for Open-Loop Geothermal Heating Development