US Geothermal Tax Credits in 2026: What Is Actually Still Alive After OBBBA For an industry that spent more than a decade building financial models around a stable federal incentive structure, 2026 has been a year of whiplash. The 30% federal geothermal tax credit that developers and homeowners built forecasts around is gone in one form and still alive in another, and even the IRS’s own public guidance has been confusing enough to trigger uncertainty across the market. That confusion is not a minor clerical issue. It is shaping investment decisions, contractor sales pitches, homeowner timelines, and project finance assumptions right now. If you work in geothermal, the key question is no longer whether federal incentives exist, but which incentive applies, to which project type, and under what ownership structure. The law that changed the timeline To understand where things stand in 2026, you have to start with the Inflation Reduction Act of 2022, which created a long runway for clean e...
115 MW of Fire Beneath California: The Deal That Could Redefine Geothermal Power Forever
In a bold and forward-looking move, and (CC Power) have signed a landmark agreement to develop 115 megawatts (MW) of next-generation geothermal energy. At first glance, it might seem like just another clean energy deal in a state already known for its climate ambitions. But look closer—and you begin to see something much bigger unfolding.
This is not just about adding megawatts to the grid.
This is about rewriting the rules of geothermal energy itself.
The Sleeping Giant Beneath California
California is no stranger to energy innovation. It leads the United States in solar deployment, has aggressive decarbonization targets, and continues to push the envelope in grid modernization. Yet, despite all this progress, a glaring paradox remains:
Beneath its surface lies an estimated 35 gigawatts (GW) of geothermal potential—enough to power millions of homes continuously—yet only about 2.7 GW has been developed.
Why?
Because traditional geothermal has always been constrained. It depends on a rare combination of heat, permeability, and water—a geological trifecta that is difficult to find and even harder to exploit economically. Most geothermal plants operate only where nature has already done the hard work.
But what if you didn’t have to rely on nature’s generosity?
What if you could engineer geothermal systems to work anywhere there is heat?
That is precisely the question XGS Energy is answering.
Breaking the Geological Chains
At the heart of this agreement lies a technological breakthrough that could change everything: a water-independent, solid-state geothermal system.
Unlike conventional geothermal plants that require underground water reservoirs to transport heat, XGS’s system eliminates that dependency entirely. Instead, it uses thermally conductive materials to extract heat directly from hot rock formations—effectively turning previously unusable geological environments into viable energy assets.
This innovation does something extraordinary:
- It decouples geothermal energy from water availability
- It removes the need for hydraulic stimulation or fracking
- It significantly reduces environmental risks and permitting challenges
- And perhaps most importantly, it opens up geothermal development across vast new geographies
In simple terms, XGS is turning geothermal from a location-limited resource into a scalable, global solution.
The GEODE Agreement: More Than Just a Contract
The newly signed Geothermal Exploration, Offtake, and Development Engagement (GEODE) Agreement is not just a technical collaboration—it is a strategic alignment between innovation and demand.
CC Power represents nine Community Choice Aggregators (CCAs), collectively serving over 2.7 million customers across California. These entities are under increasing pressure to deliver clean, reliable, and affordable energy while reducing dependence on fossil fuels.
Solar and wind have played a major role in this transition—but they come with a fundamental limitation: intermittency.
The sun sets. The wind dies.
But geothermal?
Geothermal never sleeps.
By entering into this agreement, CC Power is sending a clear signal to the market:
The future of clean energy isn’t just renewable—it must also be firm, dispatchable, and reliable.
And geothermal, especially next-generation systems like those developed by XGS, fits that requirement perfectly.
Why 115 MW Matters More Than You Think
On paper, 115 MW might not seem like a game-changing figure compared to gigawatt-scale solar farms or massive wind installations. But in the context of geothermal, it carries profound significance.
Geothermal plants operate at capacity factors exceeding 90%, meaning they produce electricity almost continuously. This makes them far more reliable than intermittent sources.
To put it into perspective:
- 115 MW of geothermal can deliver consistent, round-the-clock power
- It can stabilize grids increasingly dominated by variable renewables
- It reduces reliance on natural gas peaker plants
- And it enhances overall grid resilience
In a state like California—where grid stability has become a growing concern—this kind of dependable energy is not just valuable. It is essential.
From Inyo County to a Multi-Gigawatt Vision
This agreement didn’t emerge in isolation.
XGS Energy has already demonstrated its technology at a commercial scale in Inyo County, proving that its system can be deployed efficiently within California’s regulatory and geological environment.
But that is only the beginning.
The company is rapidly expanding its footprint across the western United States, with a growing pipeline of projects that includes a 150 MW development in New Mexico. Partnerships with major industrial players are already in place, signaling a clear path toward large-scale deployment.
What we are witnessing is the early formation of a multi-gigawatt geothermal ecosystem—one that combines:
- Advanced drilling technologies
- Industrial-scale supply chains
- Strategic partnerships
- And innovative financing models
This is not a pilot phase anymore.
This is execution.
The End of the “Niche Energy” Narrative
For decades, geothermal has been treated as a niche player in the global energy mix—reliable but limited, promising but constrained.
That narrative is beginning to collapse.
With technologies like XGS’s solid-state system, geothermal is stepping into a new role:
A cornerstone of the clean energy transition.
And California is the perfect proving ground.
The state’s aggressive climate goals, combined with its vast geothermal resources and urgent need for grid stability, create an environment where innovation is not just encouraged—it is required.
If this 115 MW project succeeds, it won’t just validate a technology.
It will validate a new paradigm.
The Environmental Advantage
One of the most compelling aspects of XGS’s system is its environmental profile.
Traditional geothermal projects, while relatively clean, can still face challenges such as:
- Water consumption
- Induced seismicity
- Land use concerns
- Complex permitting processes
XGS addresses these issues head-on:
- No consumptive water use
- No fracking or hydraulic stimulation
- Minimal surface footprint
- Reduced environmental impact
This positions the technology as one of the most sustainable energy solutions available today—not just in terms of emissions, but in terms of overall ecological footprint.
A Demand Signal Heard Across the Industry
Dr. Lucy Darago, Chief Commercial Officer at XGS Energy, described the agreement as a “strong demand signal” for next-generation geothermal.
And she’s right.
Because in the energy world, demand signals matter.
They influence investment decisions.
They accelerate innovation.
They shape policy.
When an organization like CC Power commits to geothermal at this scale, it tells developers, investors, and governments one thing:
The market is ready.
This could trigger a ripple effect, encouraging similar agreements not just across California, but globally.
What This Means for the Future of Energy
Zoom out, and the implications become even more profound.
We are entering an era where energy systems must balance three critical pillars:
- Sustainability – reducing emissions and environmental impact
- Reliability – ensuring consistent power supply
- Scalability – meeting growing global demand
Few technologies can deliver on all three simultaneously.
Geothermal—especially next-generation systems—might be one of the only ones that can.
This agreement between XGS Energy and CC Power is a glimpse into that future.
A future where:
- Power plants are not limited by geography
- Clean energy is available 24/7
- And the Earth itself becomes a limitless source of sustainable power
The Global Implications: Why Alphaxioms Should Pay Attention
For forward-thinking companies like Alphaxioms, this development is more than just news—it’s a strategic signal.
The success of XGS’s approach reinforces several key opportunities:
- Permeability enhancement and reservoir engineering remain critical for maximizing output
- Lithium extraction from geothermal brines can create additional revenue streams
- Repurposing oil and gas infrastructure for geothermal development becomes increasingly viable
- And most importantly, innovation in drilling and heat extraction technologies will define the next decade of energy leadership
The geothermal race is no longer about who has the best resources.
It’s about who has the best technology and execution strategy.
A New Energy Era Begins
As California continues its transition toward a carbon-neutral future, deals like this one will play a pivotal role in shaping the energy landscape.
But beyond policy targets and megawatt figures, something deeper is happening.
We are witnessing the transformation of geothermal energy from a supporting player into a central force in the global energy transition.
The Earth’s heat—once overlooked, underutilized, and underestimated—is finally stepping into the spotlight.
And if XGS Energy and CC Power succeed in delivering on their vision, this 115 MW project may be remembered as the moment geothermal energy truly broke free from its limitations.
Final Thoughts: Fire That Never Fades
Energy transitions are rarely defined by a single event.
They are shaped by a series of bold decisions, technological breakthroughs, and strategic partnerships.
This agreement is all three.
It represents:
- A leap in technology
- A shift in market dynamics
- And a commitment to a more reliable, sustainable future
Deep beneath California, the heat has always been there—silent, constant, and waiting.
Now, for the first time, we may finally have the tools to harness it at scale.
And when we do, the impact will be nothing short of revolutionary.
See also: XGS Energy Achieves 3,000-Hour Milestone in Geothermal Innovation
Because unlike the sun, it never sets.
Unlike the wind, it never stops.
And unlike fossil fuels… it never runs out.
Source: XGS Energy
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