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...
$25 Million Below the Waves: Endurance Energy’s Quest to Tame Underwater Volcanoes
By: Robert Buluma
Date: May 29, 2026
In the world of renewable energy, the sun doesn’t always shine, and the wind doesn’t always blow. But deep beneath the ocean’s surface, the Earth’s core is always hot. That constant, immense pressure and heat is the bet that one energy startup is making to the tune of $25 million.
Endurance Energy, a U.S.-based developer, has successfully raised a significant seed funding round to pursue one of the most frontier concepts in clean tech: subsea geothermal energy.
According to sources speaking to Axios Pro, the company closed between $25 million and $30 million in funding earlier this year . The round was led by Founders Fund, marking yet another major bet from the venture capital giant on "next-generation" energy solutions. While the technology is still in its infancy, the implications—especially for island nations tired of expensive diesel—are massive.
Power from the Pacific’s "Ring of Fire"
To understand why investors are biting, you have to look not at Silicon Valley, but at the Pacific Kingdom of Tonga.
Endurance Energy isn’t just drawing up blueprints; they are already in the water. Last month, the Tongan government announced it had begun testing subsea geothermal technology in partnership with Endurance Energy . The location is strategic. Tonga sits on a highly active volcanic arc—part of the Pacific "Ring of Fire"—where geothermal heat is incredibly close to the surface.
The pilot project aims to harness that heat generated by underwater volcanic activity to generate electricity .
This is a game-changer for energy security. In Tonga, approximately 80% of electricity generation still relies on imported diesel . This leaves the country vulnerable to volatile global fuel prices, shipping disruptions, and significant carbon emissions.
Prime Minister Lord Fakafanua, who signed a Memorandum of Understanding with Endurance Energy CEO Andrew Redd back in February, stated that geothermal power could "replace much of Tonga’s diesel base-load generation," lowering electricity costs and insulating the nation from external shocks .
How Does Underwater Geothermal Work?
While the company keeps some proprietary specifics close to the chest, the concept is distinct from traditional land-based geothermal. Instead of drilling miles into the continental crust, Endurance Energy is looking to tap into hydrothermal vents or volcanic fissures beneath the seabed.
If successful, the payoff is baseload power. Unlike solar or wind, which require battery storage to manage intermittency, geothermal energy runs 24/7. For a grid trying to phase out fossil fuels entirely (Tonga aims for 100% renewable electricity by 2035), a steady "firm" power source is the holy grail .
The High Stakes of Deep-Sea Energy
Of course, the road from pilot to power grid is fraught with challenges. The ocean is a corrosive, high-pressure environment that is notoriously brutal on machinery. Furthermore, as noted by Tonga Independent News, there are still major questions surrounding the project:
· Costs and Terms: No budget for the pilot has been disclosed, nor the commercial terms between the government and Endurance Energy .
· Ownership: It is unclear who will own the power generation assets if the project moves past the testing stage.
· Timeline: The government has not provided a specific timeline for when this might actually power a lightbulb in Tonga .
The Bigger Picture
Despite the unanswered questions, the funding round signals that major investors believe the technical hurdles are solvable.
For Endurance Energy, the $25 million seed round (led by the same firm that backed SpaceX and Palantir) provides the firepower to move from testing to potential scaling. For the rest of the world, Tonga serves as a living laboratory. If Endurance can successfully turn an underwater volcano into a reliable power plant, they won't just be saving Tonga money on diesel—they will be unlocking a new energy source for coastal communities everywhere.
The pressure is on, literally.
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