Taiwan's Geothermal Breakthrough: Jingneng and Ormat Partner for AI-Powered Baseload Energy
Taiwan stands on the edge of an energy transformation, driven by surging demand from artificial intelligence, high-performance computing, and data centers. In February 2026, Jingneng Energy Services (進能服, stock code 6692) announced a major collaboration with global geothermal leader Ormat Technologies (NYSE: ORA). This partnership focuses on developing Taiwan's first large-scale geothermal power plant in Jinshan District, New Taipei City. The 12.5MW facility aims to deliver reliable, 24/7 clean energy starting in December 2027, with annual output reaching 100 million kWh—enough to power about 30,000 households.
This project addresses critical gaps in Taiwan's renewable mix. While solar and wind have grown rapidly, they remain intermittent. Geothermal offers true baseload power, unaffected by weather or time of day, making it ideal for energy-intensive industries. As Taiwan's tech sector faces unprecedented electricity needs, this initiative could become a cornerstone for sustainable growth.
Understanding the Partnership Between Jingneng and Ormat
Jingneng, originally known for solar projects, is expanding into diversified renewables to meet evolving market demands. The company signed an equipment procurement contract with Ormat valued at approximately 18.5 million USD (around 5.86 billion NTD). This deal covers key components for the Jinshan geothermal plant, leveraging Ormat's proven expertise.
Ormat brings decades of experience as a vertically integrated geothermal specialist. From resource exploration and drilling to equipment design, plant construction, and long-term operations, Ormat handles the full lifecycle. Their flagship Ormat Energy Converter (OEC) technology excels in binary cycle systems, efficiently converting medium-to-low temperature geothermal heat into electricity. This approach suits Taiwan's geology, where high-temperature resources are limited but widespread medium-temperature fields exist.
The collaboration introduces international standards and teams during construction while building local capacity. Taiwanese engineers will gain hands-on training, helping establish a domestic geothermal supply chain. This knowledge transfer reduces future reliance on foreign technology and accelerates project scaling across the island.
Details of the Jinshan Geothermal Power Plant Project
Located in the geothermically active Jinshan area, the plant will utilize closed-loop binary cycle technology. Hot geothermal fluid heats a secondary working fluid to drive turbines, then reinjects cooled water underground. This minimizes environmental impact, avoids direct steam release, and prevents issues like scaling or corrosion common in flash systems.
With 12.5MW installed capacity, the facility exceeds previous Taiwanese geothermal demonstrations, marking the country's first plant over 10MW. Construction timelines target commercial operations by the end of 2027. Once online, it will generate 100 million kWh annually—equivalent to a 70MW solar farm but without downtime or storage needs.
The project's design accounts for Taiwan's seismic risks and resource characteristics. Ormat's integrated model streamlines execution, from well drilling to grid connection. This efficiency lowers overall costs and risks compared to fragmented approaches.
Why Geothermal Matters in the Age of AI Energy Demand
Generative AI, cloud computing, and HPC facilities consume vast, constant power. International forecasts predict double-digit annual growth in data center electricity use through the coming years. In Taiwan, home to leading semiconductor manufacturers, this demand concentrates on reliable, high-quality supply.
Traditional grids struggle with such loads, often relying on fossil backups during peaks. Geothermal changes the equation by providing zero-emission baseload power that matches nuclear or coal reliability but aligns with net-zero targets. Its constant output eliminates the intermittency challenges of solar and wind, reducing the need for expensive battery storage.
For AI operators requiring uptime guarantees, geothermal offers "always-on" green energy. The Jinshan plant positions Taiwan to attract and support data center expansions while advancing energy security and reducing carbon footprints.
Taiwan's Untapped Geothermal Resources and Historical Context
Taiwan lies along the Pacific Ring of Fire, boasting substantial geothermal potential estimated in the gigawatts range. Despite this abundance, development has lagged due to high upfront costs, technical challenges, regulatory hurdles, and limited investment.
Early efforts focused on small demonstration plants, such as those in Yilan and other northern sites. Recent partnerships, including Ormat's prior involvement in reviving facilities like Qingshui, have built momentum. The Jinshan project builds on these foundations, scaling to commercial levels and proving economic viability.
Government policies increasingly support geothermal through streamlined permitting and incentives for baseload renewables. As AI-driven demand intensifies, geothermal emerges as a strategic priority for grid stability and industrial competitiveness.
Challenges and Opportunities Ahead
Developing geothermal involves risks like resource uncertainty, drilling complexities, and community concerns over land use. However, Ormat's track record mitigates many issues through advanced technology and careful site management. Low visual and noise impact, plus reinjection to sustain reservoirs, help address environmental and social considerations.
Opportunities extend beyond Jinshan. Success here could unlock additional sites, potentially contributing several gigawatts long-term. Combined with solar, wind, and emerging storage, geothermal diversifies Taiwan's energy portfolio, enhancing resilience against supply disruptions and climate variability.
This project also fosters economic benefits, creating jobs in engineering, construction, and operations while stimulating related industries like drilling services and equipment manufacturing.
Looking Forward: Geothermal's Role in Taiwan's Sustainable Future
The Jingneng-Ormat alliance represents more than a single power plant—it's a strategic step toward energy independence and green innovation. By delivering stable, clean baseload power, the Jinshan facility will support Taiwan's tech leadership while advancing climate goals.
As global energy needs evolve with AI and digitalization, geothermal stands out as a reliable, domestic solution. This partnership sets a precedent for future collaborations, inspiring investment and policy support to fully harness Taiwan's geothermal wealth.
In the coming years, expect more announcements as developers scale up. Taiwan's geothermal revolution is just beginning, promising a brighter, more sustainable energy landscape for generations to come.
Source: Finance Tech News
Comments
Post a Comment